Quoteworthy: “We should get used to the fact that China is going to keep growing and become stronger and we have to figure out a way to work with them while protecting our industries and protecting our country militarily.”
— US presidential candidate Michael Bloomberg in his first CNN town hall
Singapore’s REIT hub ambition pays off with most foreign IPOs
Singapore may be tiny by geographical size, but its sway in the property management industry is anything but small.
Since the city-state saw the first sale of a real estate investment trust in 2002, Singapore has transformed itself to a global listing center of such firms. It has pocketed 41 REIT IPOs, of which seven foreign-currency-denominated ones are the most globally, according to Bloomberg-compiled data. In comparison, Hong Kong — the world’s top initial public offering venue last year — has just 11.
The country’s favorable tax regime and well-established legal system made it particularly appealing for international investment trusts. Being commercially flexible and open to tweaking its regulations has allowed Singapore to continue to lead in the area, according to Ee Kean Wong, capital markets partner at WongPartnership LLP.
With a yield of 6.2% — one of the highest globally — Singapore-listed REITs are sought after and more frequently traded by investors than most of the blue-chip stocks in the country. The importance of REITs has also shown up in their Straits Times Index weighting, which has doubled over the last five years. — Bloomberg
Singapore remains attractive as O&G downstream hub amid lower global M&A volume, value: EY
Amid lower transaction activity and valuation in the oil and gas industry, Singapore continues to be an attractive location for oil companies looking to set up streamlined trading functions, according to EY.
EY says that the country, which sits in a region that is a consumption hub, incentivises oil majors and national oil companies to continue focusing on the downstream segment, in particular, petrochemicals, retail and lubricants.
“As companies in Asia look to retain profitability across the value chain, there is increased focus on optimisation of processes and expansion into extended value chain, such as trading,” Sanjeev Gupta, EY Asia-Pacific oil & gas leader, says in a Feb 27 statement.
Last year, the total volume and value of mergers and acquisition (M&A) deals in the global O&G industry tumbled 17.7% and 10.8%, respectively, according to EY. These came on the back of stagnant commodity prices, disappointing results and low returns.
For the global upstream segment, M&A deal value was up 17.6% in 2019 thanks to two deals, while M&A deal volume was down 20%, translating to an average M&A deal value of US$122 million ($170.5 million), which was in line with the previous year.
Looking ahead, EY says environmental, social, governance and energy transition considerations will continue to be key themes for the deployment of capital this year. — Jeffrey Tan
Dip in Jan 2020 CPI raises questions of monetary policy easing among private-sector economists
Singapore’s headline and core inflation for January has fallen sharper than expected by economists and official forecasts.
Headline inflation came in at 0.8%, unchanged from the month before, according to the consumer price index (CPI) released by the Department of Statistics. The data is a smidgen below the 0.9% forecast by private-sector watchers in a Bloomberg poll.
Meanwhile, core inflation — which excludes accommodation and road transport costs – came in at 0.3%, a significant drop from 0.6% in the previous month and below the 0.9% predicted by the Bloomberg poll.
For now, the MAS and MTI expect inflationary pressures to remain subdued in the near term amid Covid-19 as well as softening domestic labour market conditions.
“Economic uncertainty, including the effects of the Covid-19 outbreak, will likely discourage firms from passing on any cost increases to consumers,” note MAS and MTI in a joint statement.
As such, they are keeping their 2020 forecasts for both headline and core inflation unchanged at 0.5 to 1.5%.
According to UOB economist Barnabas Gan, the lack of inflation at the start of 2020 could fuel impetus for policymakers to spur growth via a loosening of monetary policy.
“An easing of monetary policy may be on the cards in order to allow the [Singapore dollar nominal effective exchange rate] (SGDNEER) to weaken further in line with the softened economic outlook,” he adds. — Amala Balakrishner
Former Natural Cool director Wong charged with manipulating Gaylin shares
Wong Leon Keat, a former director of Natural Cool Holdings, a company listed on Catalist of the SGX, was charged for offences under the Securities and Futures Act (SFA) and Penal Code.
Wong faces 17 charges under section 197(1) (b) SFA for creating misleading appearances with respect to the price of the shares issued by Gaylin Holdings (Gaylin) on 17 occasions between 11 November 2015 and 25 October 2016. He also faces one charge under section 201(b) SFA for deceiving UOB Kay Hian by not disclosing his beneficial interest in 50% of the Gaylin shares bought using an UOBKH trading account belonging to another individual.
Wong faces a further charge under section 182 PC for furnishing false information to a public servant during the investigation.
If convicted, Wong faces a jail term of up to seven years, and, or a fine of up to $250,000 for the share manipulation charges. He faces up to a year’s jail, an or fine of up to $5,000, for giving false information. — Uma Devi
