As part of its foreign investment strategy, cash-rich Singapore is seeking to step up its investments in Britain by taking over infrastructure, including ports and airports.
The government is also extending its influence in Southeast Asia. This week, the state holding company Temasek took a leading share in Standard Chartered Bank by buying the 11.55 percent of shares held by billionaire Khoo Teck Puat (邱德拔) for 3.55 billion euros (US$4.3 billion).
Temasek, through its ports subsidiary PSA, which already owns the harbor facilities of Antwerp and Zeebrugge in Belgium, was beaten by Dubai Ports World in its 5.1 billion euro bid to buy the British ports operator, Peninsular and Oriental.
Another government holding, GIC, is part of a consortium led by the Goldman Sachs group to take over Associated British Ports, which owns 21 ports in Britain and four in the US, and which on Wednesday rejected a first offer of 3.23 billion euros.
GIC also forms part of a group led by Ferrovial of Spain that is seeking to take over the British airports concession owned by BAA, which has turned down an offer of 12.75 billion euros.
The Singapore holdings have deep pockets, but just how deep is a mystery.
"Nobody truly knows to be honest," said Joseph Tan, an economist at Standard Chartered. "[The knowledge] is not publicly available."
But Tan noted that some experts put the figure in excess of US$100 billion.
"When you have a significant surplus of that size it's only smart investment to take the reserves and to buy assets overseas which give you a good return," he said.
But Tan said there was a lot of competition among institutional investors, which recognize "the high attraction of ports ... with such consistent and dependable revenue streams to match the liabilities of long-term pension funds."
Tan said the expansion of the powerhouse mini-state is based on investment decisions made by the government. GIC is presided-over by Lee Kwan Yew (
GIC concentrates its activities abroad, with offices in Tokyo, Beijing, London, New York and San Francisco, while half of Temasek's activities are within Singapore, particularly in public services.
However, Temasek is seeking to diversify so that one-third of its activities are in Singapore, one-third in Asia not counting Japan, and one- third in the rest of the world, Japan included.
The foreign investments are driven by purely commercial considerations.
"Singapore is a very neutral country politically speaking," Tan said. "They do not align themselves to any political power."
If much of the investment campaign is focused on Britain, that is because this historic maritime power has established such a strong position in port operations. The Singapore PSA ports subsidiary, meanwhile, is keen to establish a global presence by buying container ports.
Whether Singapore also wants to snap up general cargo facilities is not so clear.
"When it comes to more general cargo ports there aren't that many opportunities around the world," Tan said. "Most of them tend to be UK companies."
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