This week sees some interesting developments in our closest neighbour. Persistent opposition politician, Anwar Ibrahim, has finally become Prime Minister of Malaysia. Anwar’s political career is a storied one. From Mahathir’s right-hand man, to allegedly trumped up charges of sodomy, to prison time, to an uncomfortable political alliance with his one-time mentor and now, against all odds, Prime Minister. The life and times of Anwar are certainly inspirational for any opposition politician.
According to experts, Anwar’s appointment as Prime Minister by the King of Malaysia will be vulnerable to attacks from opposition politicians simply because he has not got a simple majority. How will Anwar manage this? What lies in store for the future of Malaysia under the premiership of Anwar? How will this affect relations with Singapore? Anwar now faces the job of forming a government, which will be very different from being the opposition, and we wish him every success.
On the home front, our own elected opposition members of parliament (MPs) from the Workers’ Party (WP) have filed questions for the Ministry of Finance and the Prime Minister’s Office for upcoming parliamentary sittings from Nov 28 to 30 in the wake of cryptocurrency exchange company FTX filing for bankruptcy earlier this month.
For those unaware, FTX, once the third-largest crypto exchange in the world, filed for bankruptcy in the United States on Nov 11. Temasek Holdings, which has a $210 million investment, which accounted for 1% of FTX International, and $65 million for 1.5% of FTX.US has written off its entire investment in FTX, saying that its overall exposure to the failed exchange is negligible compared to its broad portfolio holdings. While this may seem negligible to Temasek, this is a colossal sum to average Singaporeans, especially at a time of escalating costs of living and a squeeze on wages.
Assoc Prof Jamus Lim of the WP wrote in a Facebook post on Tuesday (Nov 23) that MPs have “historically been limited” concerning how they’ve been able to pose parliamentary questions about investments by sovereign wealth funds. “Nevertheless, given the importance of such questions in the public interest, the #workersparty felt that it was necessary to pose some questions on the episode, while respecting the limitations of what we are able to credibly ask via PQs,” he added.
Singapore’s central bank, the Monetary Authority of Singapore (MAS), issued a statement on Monday (Nov 21) to answer questions and address misconceptions stemming from the recent collapse of cryptocurrency exchange giant FTX. Among other things, the MAS said in its statement, that “The most important lesson from the FTX debacle is that dealing in any cryptocurrency, on any platform, is hazardous,” adding that it “has consistently warned about the dangers of dealing with unregulated entities.”
On its part, Temasek Holdings, issued a statement on Nov 17 saying, among other things, that there have been misperceptions that Temasek’s investment in FTX was an investment into cryptocurrencies. It clarified that the firm currently did not have any direct exposure to cryptocurrencies.
It will be interesting to see what WP’s questions will reveal in Parliament. Watch this space.
Now, let’s juxtapose Temasek Holdings calling $210 million negligible in the face of the scores of elderly people having to work backbreaking jobs well past retirement age.
As Tang Li so aptly writes: “In the case of Singapore, everyone gets to see Shenton Way or the Marina Bay Sands. These are iconic images and they are very nice. I admit they are great to look at and very pleasant areas. One of my great after-work pleasures is to walk from Shenton Way to the Marina Bay Sands casino and towards the bus home.
However, as much as these places are nice, it’s important to remember that these places do not paint an accurate picture of what Singapore is. One of the most visible signs that Singapore isn’t just the glitziest place for Crazy Rich Asians comes in the form of the elderly cardboard box collectors.”
With the WP vehemently opposing the rise in the Goods and Services Tax (GST) and the People’s Action Party (PAP) pushing ahead despite concerns that this was not the right time to be raising a consumer tax, where does the common man fit in?
Senior Minister of State for Finance Chee Hong Tat wrote that the recent debate over the increase in GST in Parliament reveals the “fundamental differences” between the ruling PAP and the WP. Mr Chee wrote, somehow misguidedly, in my opinion, that:
“The PAP government believes that we should spend within our means – if expenditure increases, so must tax revenue. We also believe that every generation must do its part to safeguard Singapore’s hard-earned reserves, to ensure it can continue to generate resources for the future and to provide a rainy-day fund for subsequent future generations to tackle any emergencies.
The WP believes that we should avoid unpopular broad-based taxes like the GST and fund our higher expenditure by taking more from the reserves, thereby leaving future generations of Singaporeans with less money and a weakened financial position.”
This seems somewhat self-serving, given that many people will find it difficult to eke out a living with these new increases. Let’s bear in mind that the GST is a consumer tax, meaning that it will affect those with the lowest wages the most. It is also imperative to remember that there are no exemptions for necessities in our GST regime.
If the Government really wanted Singapore to live within its means, there are other ways to do it. For example, cut the extremely high salaries of our ministers to match the salaries of other developed countries as a start. Or, tax luxury goods harder, while carving out exemptions for staples such as rice and children’s necessities. To increase GST wholesale is lazy, in my opinion! And to make it about living within our means is an utter insult!
WP MP Leon Perera has responded to Mr Chee saying that economic conditions are different today than when the GST hike was first discussed a few years ago. He added that raising the GST when the rates of inflation are so high adds to the risk that inflation will get even higher. “It is irresponsible to press ahead with this GST hike when inflation has not even been tamed.”
Mr Perera ended his post with a note about political courage. “Political courage means recognising that the facts and assumptions that supported an earlier decision have changed, as is the case with the current inflationary pressures. Political courage means being able to recognise that contrary arguments have merit, even if those arguments come from one’s political opponents.”
And on this note, see you next week.