IT Financing
Singapore’s
Economy
Singapore has
developed a strong presents in maintaining it’s economic strength in the
IT market without going into debt due to its’ size as a country. In 1998
Singapore had reported a growth rate of 1.5 per cent. Singapore’s
neighbors had been experiencing an economic crisis because of heavy
borrowing and extending loans beyond their means. Singapore has maintained
strong financial stand because 70% of the country is government owned
allowed the country to stand independently because the government had to
come up with a strategy that would allow a county that lack natural
resources to gain a competitive edge with a it’s technical expertise.
The skill sets that Singapore help to get a
competitive edge were:
·
Singapore has produced 5 of
the 6 top players in world manufacturing perfecting the “Speed to
Market” method.
·
Half of top 20 semiconductor
manufactures are represented by Singapore.
·
A combination of strategic
investments, tax incentives, research and development grants has
encouraged the growth of outside business investing business ventures in
Singapore.
·
The increase of electronics
and chemical had generated about 150 new electronic projects that will
take until the year 2010 to develop.
·
A large emphasis on life
science on drugs, medical devices, agricultural products and food
intermediates. Singapore wants to be the home to the top 15 world-class
life science companies.
Finances in Singapore
Singapore is one of
the most over banked countries in the world. They were able to gain large
revenue for mortgage loans that were given to Singaporeans, but very
little was given for government corporation, but recently that has changed
because of the need to make a presence in the Information Technology
sector. This graph shows how the money that between banking overseas verse
banking domestically had changed their buying power.
|
Singapore
banks: domestic & overseas non-performing loans |
|||||
|
Gross
(%) |
Collateral
(%) |
Net
(%) |
|
||
|
|
|||||
|
Singapore |
10 |
70 |
3 |
|
|
|
Overseas: |
Malaysia |
25 |
50 |
13 |
|
|
|
Greater
China |
8 |
65 |
3 |
|
|
|
Indonesia |
70 |
20 |
56 |
|
|
|
Australia |
5 |
80 |
1 |
|
|
|
Philippines |
15 |
60 |
6 |
|
|
|
Thailand |
40 |
35 |
6 |
|
|
|
Korea |
25 |
30 |
18 |
|
|
|
Others |
10 |
70 |
3 |
|
|
|
|||||
|
|
DBS
Bank |
OCBC
Bank |
OUB |
UOB |
|
|
|
|
||||
|
Gross
NPL (%) |
11.6 |
14.2 |
16.5 |
12.1 |
|
|
Net
NPL (%) |
4.4 |
6.1 |
6.2 |
4.6 |
|
|
Loans |
43,627 |
35,762 |
23,573 |
28,572 |
|
|
Net
NPL (S$m) |
1,916 |
2,180 |
1,463 |
1,325 |
|
|
|
|||||
|
Source:
SG Securities Research |
|||||
The main concern that
Singapore had was how to maintain the multinational companies to continue
investing in their technological growth that has shown to be small, but a
very powerful producer of revenue.
Links:
HTTP://www.ft.com/ftsurveys/country/sing_eco.htm