Why the GIC cannot disclose value of its assets
The Government of Singapore Investment Corporation (GIC) cannot disclose the exact amount of assets it manages and its annual profit and loss because doing so would open Singapore to speculative attacks on its currency, the Ministry of Finance (MOF) said.
When such data are taken together with the disclosed figures of the Monetary Authority of Singapore and Temasek Holdings, the full size of the country’s financial reserves would be made known, said director of corporate communications at MOF Lim Bee Khim in a letter published in a newspaper on Friday.
“This is against our national interest. It would make it easier for speculators to attack the Singapore dollar during periods of vulnerability,” she said, in response to a previous letter from a reader published on Wednesday.
“Further, our reserves are a strategic asset, especially for a small country with no natural resources or other assets,” said Lim. “It would be unwise to reveal the exact amount at our disposal for defending our currency or for use in an emergency.”
Lim, though, reiterated that the assets managed by the GIC were “well over US$100 billion” (S$130 billion) in value.
In response to the reader’s queries about the measures GIC has taken to prevent a collapse in the value of its invested assets, should a crisis strike again, Lim said the organisation invests in a “well-diversified portfolio”, with a balanced distribution of asset classes.
She also said that the GIC reports its 20-year annualised real rate of return, as well as its returns over five- and 10-year periods, to show its performance in the interim.
In response to a further mention by the letter-writer of the newly-appointed President Tony Tan’s role in the GIC, Lim said that Tan does not oversee investment strategies of any of Singapore’s investment arms, but instead approves appointments of board members and CEOs to these organisations.
