INTERNATIONAL FINANCE CORPORATION BILL

Order for Second Reading read.

4.25 p.m.

The Parliamentary Secretary to the Minister for Finance (Mr Tang See Chim) (for the Minister for Finance): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time.

The Bill seeks to enable Singapore to become a member of the International Finance Corporation (I.F.C.), which is an affiliate organisation of the World Bank. The International Finance Corporation provides capital in the form of loans to, and equity participation in private enterprises which do not fall within the scope of the World Bank activities. The World Bank lends only to government and semi-government bodies. The I.F.C. also undertakes standby and underwriting operations and provides financial and technical assistance to privately controlled development financial companies. Its activities are therefore similar in many respects to those of an investment banker. Furthermore, the I.F.C. does not require government guarantees in its operations.

By becoming a member of I.F.C., Singapore will give her private enterprises access to a further source of capital from abroad. I.F.C. participation in our private enterprises will further enhance the standing and viability of our private development projects and, indirectly, the economic viability of Singapore.

In order to benefit from I.F.C.'s operations. Singapore must become a member by subscribing to US$177,000 at par, which is Singapore's quota, to the capital stock of the Corporation. This is provided under clause (4) (a) of the Bill.

One of the two big projects which we can immediately submit to I.F.C. for participation is our proposed

Industrial Development Bank whose main operations will be to undertake development financing.

The other big project which we can get I.F.C, to participate is in the hotel industry which is now entering a boom. This is an enterprise relating to tourism in which I.F.C, is prepared to invest. The bigger hotel projects in Singapore will be eligible to obtain this additional source of funds from the Corporation, once we become a member.

Sir, I beg to move.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. -[Mr Tang See Chim].

Bill considered in Committee; reported without amendment: read a Third time and passed.