GOVERNMENT COMPANIES

Mr J B Jeyaretnam asked the Minister for Finance if he will furnish a schedule of all investments, acquisitions or takeovers made by Government-owned and Government-linked companies year by year, for the years 1988-1997, showing the investments, acquisitions or takeovers made by each company and the profits made or losses suffered by the company from the investments, acquisitions or takeovers.

Dr Richard Hu Tsu Tau: The investments, acquisitions and takeovers made by GLCs are driven by their corporate strategies for growth and diversification. They are long term investments and are made after due diligence. Until they are sold or disposed of, it is often not meaningful to determine the capital gains/losses arising from the investment made as these are still unrealised. When the investments are divested, the realised profits or losses will be reflected in their accounts. However, since most of these investments, acquisitions and takeovers are long-term investments and have yet to be realised or disposed of, it would not be meaningful to try to furnish a schedule of the investments, acquisitions or takeovers made by the GLCs, and to determine the profits/losses made arising from them, as the NCMP has requested.

The NCMP may wish to note that the contributions of operating profits or losses from their major investments or acquisitions are included in the annual accounts of the GLCs in accordance with standard accounting treatment for the reporting of the accounts of a company. In addition, for the listed GLCs, like other companies under SES regulations, they would have to seek shareholders' approval for major acquisitions and divestments. There is therefore already a considerable amount of transparency and public scrutiny over major investments and acquisitions made by our GLCs, as well as their performance or non-performance.