By Kumar David –

Prof. Kumar David

Temasek Holdings Limited, or simply Temasek, is a Singaporean state holding company 100% owned by the Government of Singapore. Incorporated on 25 June 1974, its net portfolio is US$287 billion as of end 2022 with US$61 billion invested during that year. It owns all the assets it manages, issues international bonds and is credit rated. 

Another interesting feature is the relationship between Temasek, the Singapore government and China. Singapore is becoming an important link in China’s financial and political strategy. For example, Singaporean PM Lee Hsien Loong and Malaysian PM Anwar Ibrahim bemoaned big power rivalry and said “economic imperatives are overshadowed by security concerns”. Chinese PM Li Qiang while actively courting Singapore, hit out at “Group Confrontation” and opposed unilateral sanctions. That is, he engaged in choreographed courting of Singapore and condemnation US American foreign policy.

The Singapore-Temasek concept

China’s global asset base is US$12 trillion or $18 trillion, (depending which source you believe) in banking, insurance, securities, Treasuries and capital investments. China Investment Corporation (CIC), modelled on Temasek, is a sovereign wealth fund which manages part of  China’s foreign exchange reserves. It was established in 2007 and manages about US$ one trillion of state assets. In 2008 it joined the International Forum of Sovereign Wealth Funds and signed up to the ‘Santiago Principles on best practice in managing sovereign wealth funds’. It established its first foreign office in Toronto, choosing it over New York and London. In September 2013, the fund acquired a 12.5% stake in the Russian potash fertiliser company Uralkali for $2 billion, in January 2017 acquired a 45% stake in the office skyscraper 1211 Avenue of the Americas, New York valued at $2.3 billion, and Nov. 2017 purchased Logicor, a European warehouse company, from Blackstone Group for $13.5 billion. This information may be reassuring to the JVP that the Temasek model can be used to ensure independence from US imperialist domination.

The public face of Singapore and Temasek

The JVP and National Peoples’ Power (of which I am a member) are firmly opposed to President Ranil’s (RW) intention to privatise successful, that is money making state enterprises. Ranil Wickremesinghe (RW) is a Thatcherite. Margaret Thatcher privatised the highly successful Central Electricity Board, British Rail, British Telecom and Water Supply. Her successors got rid of the Royal Mail. She was a neo-liberal in economics and a neo-conservative in ideology. I do not hesitate to describe her as a political felon!

The purpose of this piece is to explore whether Temasek is a usable example to bridge the gap between directive state control and the flexibility of private enterprises. First let me tell you about Temasek. The origin of the term is obscure and may refer to ancient Malay, Chinese or Sumatran folklore. From the 7th to the 13th centuries, the island was ruled by the Sumatran Empire. Diplomatic links with Vietnam may have been established at the end of that period. Later the city became a trading centre and in the 14th century during the Yuan (Mongol) Dynasty traded with the island in tame elephants. Something odd is that a web search does not reveal the birth date (enigmatically described as 1963/64), or origin (Indian?) of Temasek’s current Chief Executive Officer Dilhan Pillay Sandrasegara(n).

A large state-owned enterprise like Temasek with oversight and control of profitable state-owned enterprises should first take over and then dump white-elephants like SriLankan Airlines. That is give it away for a dollar to anyone who will take it with all its debts as with Silicon Valley Bank. This will satisfy leftists that privatisation of valuable state enterprises will be blocked, but rubbish discarded. This concept has to be thought out, filled in with detail and a programme written. The directive role of the state is preserved while space for enterprise-level innovation is accommodated. The international relations that Temasek has been instrumental in establishing, for example not becoming an instrument of American economic and foreign policy, will also be reassuring to the left. 

At the same time, it is essential to ensure that the authoritarian intentions of the RW Administration are choked off. This no Temasek can do; it will need the mobilisation of the broad mass of the people, trade unions, students, middle classes and the poor. With electoral victory in sight the JVP/NPP can execute a two-pronged strategy (economic and political) up to the time of the local government (LG) elections in April. Strategic political re-evaluation will be the next phase after the elections. RW knows that he doesn’t have chance in hell of winning the LG elections, which is why he finds one subterfuge after another for postponing. He may be able to pull together a right or centre-right alliance to secure second place. With Sajith Premadasa’s SJB in shambles that’s what the electoral scene looks like now. But let’s not cross too many bridges before we reach them.  

RW must face facts. Securing first place in the April Local Government and subsequent parliamentary elections is out of the question. However, he has the support of the bourgeoisie and the business classes, the Premadasa party is in disarray and he will be able deliver some economic goodies with the support of the IMF. He has to abandon his plans to replace the Prevention of Terrorism act by more horrendous alternatives. He will have to avoid the opprobrium of international human rights councils and NGOs by abandoning the repressive alternatives that he has toyed with. He must understand that playing with the military option will spark a popular uprising. RW must wake up the fact that his place as national leader, Executive President (or Prime Minister if the Ex-P post is abolished) is only a one-term job. He has fired his gun, emptied his barrel and must prepare for the luxury of retirement.

Well it may not be that negative. It is possible that RW as leader of the opposition for one constitutional period may consolidate himself as leader of a right-wing or centre-right bourgeoise democratic alliance and make a future bid for national leadership. Politics is an ever-changing comic opera and as I said a moment ago “Don’t cross your bridges” before you reach them. 

If RW is a realist he will appreciate that this innings is over he would be wise to declare it closed, refrain from provoking an Aragalaya style uprising and hope that with IMF backing, some economic deliverables and some improvement in the rupee exchange rate the electorate may give him another chance in the future. At $4000 per capita, at market not nominal (not PPP) exchange rates, Sri Lanka is far from what is called the “Middle Income Trap”; MIT is when a country reaches a moderate level of income for special reasons but cannot proceed any further due to general or global circumstances. But is RW over 70? Oh dear, then come-back-kid is not an option. He had better hang up his pads and retire to the old-timer’s bar for a beer.

What I am going to say next I have repeated many times but it bears repetition over and over again until the NPP/JVP show signs of being less deaf. People, by and large the Sinhalese majority of the population, need to feel reassured that there will not be a recurrence of insurrectionary excesses as in 1971, nor violent extremism as in 1989-91. I am satisfied that the JVP, under NPP tactical guidance, will not do anything so foolish, however, it would helpful if Anura Kumara Dissanayake in his press conferences and speeches makes a commitment to social-democracy and to democracy in general. I have also often complained about the absence of a written and officially endorsed NPP programme; I repeat that complaint.  

I have a parallel complaint about the left’s pronouncements regarding ethnic and religious minorities. The NPP must explicitly reject the Wijeweera-Somawansa inheritance, explicitly reassure the ethnic and religious minorities, rejects its previous stand on Sinhala-Only, the Chapter making Buddhism the State Religion, returning Tamil lands stolen by the military in the North and East, and change its attitude to the persons known as the “disappeared”. 

Undeniably the global conjuncture is amazingly unusual. A Post-Covid world, economic and strategic confrontation between America and China, the US dollar under unusual stress, and attempts afoot to bypass the dollar-based payments system (SWIFT etc) are all unusual. Worried about the shift in global power balances the US has taken steps to starve China of access to technology; nano-chip, AI, 5G, robotics and even business software. Sabre rattling in the Taiwan straits has peaked. These concerns are all too well known to readers and this article is not intended to be theoretical or ideological. It’s simply common sense and I do hope this piece captures the gut feeling of my readers about domestic necessities and global drifts.