INVESTMENTS IN THE PEOPLE'S REPUBIC OF CHINA BY SINGAPORE-BASED COMPANIES

Mr Yeo Choo Kok asked the Minister for Trade and Industry (a) how many Singapore-based companies have invested in the People's Republic of China to date; (b) what is the level of investment committed; (c) what are the major problems faced by Singaporean investors in the PRC; and (d) whether there is an investment guarantee between the PRC and Singapore.

The Minister for Trade and Industry (BG Lee Hsien Loong): Mr Deputy Speaker, Sir, some 90 Singapore-based companies have committed a total of about US$200 million in the PRC as at the end of last year.

According to a recent survey of 50 Singapore companies, the main difficulties faced by our investors in China are: the high cost of doing business, in terms of imported materials, capital equipment and workers' training; inadequate infrastructural facilities and supporting services in certain localities; identifying a suitable PRC joint venture partner since the foreign partner often bears substantial financial risks; and sourcing good quality local supplies as these are scarce and not always readily available.

As for an investment guarantee agreement, such an agreement was signed between the PRC and Singapore in February 1986.

Mr Yeo Choo Kok (Delta): Sir, has any Singaporean businessman just mentioned suffered any loss as a result of the political rearrangement that took place not long ago in the PRC?

BG Lee Hsien Loong: Mr Deputy Speaker, I think the question is whether any Singapore businessman has suffered financial loss as a result of the political upheavals in the PRC. Not that I am aware of.