In the dark in Singapore

Robert Clark
23 Jul 2009

He could've been the biggest guy in Singapore telecoms - but Chip Goodyear decided not to go to Temasek.

In declining the CEO post the former head of BHP Billiton thus foregoes the privilege - surely unique for the head of a fund - of being able to choose rival telco CEOs.

The government investment arm owns 55% of SingTel and, through 100%-owned subsidiary ST Telemedia, is the biggest shareholder in no.2 telco StarHub.

Temasek, which also has extensive finance, media and utilities holdings, announced Monday that US-born Goodyear would not take over as CEO on October 1 as planned, citing "strategic issues."

The WSJeditorialized with $84 billion in assets at Temasek, "Singaporeans deserve to know what happened" at the government's flagship investment firm. The paper didn't have to mention that under the stewardship of the prime minister's wife it lost $39 billion last year.

I mention all of this not because of Temasek's control of the telcos but because the local regulator also has transparency issues.

The IDA is tipping S$1 billion ($693 million) in public money into the next-gen broadband project. That's a lot of cash - equivalent to 12% of the revenue from the entire telecom sector last year.

IDA chief Ronnie Tay declines to say how much of this money has been spent and how and by whom, and says he has no intention of doing so. For someone whose air-conditioned office, government-issued vehicle and generous salary are part if not wholly taxpayer-funded, this seems ungrateful to say the least.

No one doubts that it is within the spirit of the Singapore ruling ethos, but you have to wonder whether is within the spirit of the 21st century.

The IDA also shares with Temasek an important role in choosing telco CEOs, namely the right to veto. For example, it reserves the right to block Neil Montefiore from taking up the CEO post at StarHub.

I am not clear why the IDA, which has a good record as a lightish-touch regulator, sees the need to vouchsafe for the executive appointments of private companies (even - or especially - those controlled by the government).

Neither, it seems, is the IDA. It has yet to respond to the question posed a week ago.

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