Source : Straits Times - 16 Mar 2009
I REFER to last Thursday’s letter, “JTC divestment aimed at letting private sector lead growth”.
I disagree with the philosophy that the private sector is the engine of growth for the economy, and that the Government should not compete with the private sector.
There is a dichotomy between running manufacturing, commercial and service industries and providing ready-built spaces. The former is the engine of growth while the latter is not. In the matter of land supply and factory space, JTC has no competition. This philosophy does not hold water.
The rapid developments of industrial estates in land-scarce Singapore are mainly due to the orderly planning and hard work of JTC, which has been instrumental in supplying land at “reasonable” cost for industries to build factories. To accelerate the pace of industrial development, JTC offered flatted, terrace and stand-alone factories to promote a steady growth of local and overseas small and medium-sized enterprises (SMEs).
A responsible government body, JTC has always been pro-industry in setting the benchmark for land and factory rentals. It has never been considered a private entity in any form. In times of economic downturn, the Government advised reduction in charges. JTC’s plan to divest its ready-built industrial space is a “tactical” move to secure better returns from SMEs.
While JTC is not a dominant player in the ready-built market, it still has great influence in the market. Why should it divest? In time to come, would the divested entity grow into another listed giant like the three local banks, two public transport companies and one energy utility company?
I hope JTC understands that large listed corporations may not be in the best interest of the public.
JTC should focus on its pivotal role of helping the industrial and manufacturing sectors, which are the engines of growth, and play a counter-balancing role to moderate the industrial property markets in times of distress.
Paul Chan
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