05 Mar 2018
ISCA CEO, Mr Lee Fook Chiew, was quoted in The Business Times on the question of "How do you see Singapore's infrastructure funding plans? What are the pros and cons of government borrowing to finance long-term mega projects? Is there a role for the private sector?" This is what he has to share:
Using debt funding for infrastructure projects is fairly common in other countries. Infrastructure projects are usually undertaken by private developers, based on government concessions. This reduces the initial capital injection by the government. Apart from reducing the need to tap on national reserves, this leverage also provides greater leeway to simultaneously undertake more projects. Stretching the repayment and servicing of the debt over a period of time enables the development cost to be spread across different generations of users. Finally, tapping the market for debt funding allows commercial lenders to provide another level of scrutiny and evaluation of the projects’ viability. The government agencies responsible for the projects will also be subject to market discipline in project development and operations, to meet debt servicing and repayment deadlines. - Lee Fook Chiew, Chief Executive Officer, Institute of Singapore Chartered Accountants (ISCA)
This article was first published in "Views From the Top" in The Business Times on 5 Mar 2018.
Share this Page