Why is Temasek, the Poor Little Rich Girl Everyone Loves to Hate?

November 21, 2007

Singapore’s leaders may not be accustomed to watching their effigies burn on CNN. And yet this was what happened Sept last year. Bearing the full brunt of the public ire was Temasek Holdings. Having taken up a $3.7 billion equity stake in Shin Corp, Thaksin’s flagship Telco firm, Temasek found itself sucked into a political maelstrom.

Recently, Indonesia’s anti-monopoly agency began investigating Temasek when an Indonesian labour union filed a complaint, alleging that Temasek violated anti-monopoly laws – it seems Temasek may have run foul into another political maelstorm again?

What’s really happening here? Is this the curse of Tutankhamen making it’s millennium rounds to this part of the tropics? Why are Singaporean firms like Temasek, so susceptible to the perils of being regularly single out for unnecessary attention? I know, it’s not fair – I even know, there may be no evidence to suggest they should even ‘find fault’ with us in the first place!– in fact there is every evidence to suggest, they may even be irrational, but what really is at the heart of the gripe?

In mid February 2007, the MP for the West Coast GRC, Ho Geok Choo asked whether Singapore should consider ramping down its pace of development to placate its neighbors. “…our success and fast growth may be creating a lot of tensions with our neighbors, who feel the threats of challenges and stress.”

Does it have something to do with jealously? The politics of envy? Is it simply a case of the have not’s throwing a tantrum? Whatever the answer, it’s a question that cast long shadows and brings into sharp relief – the perils of being a Singaporean firm in ASEAN.

(1). Is There Something Wrong With Singapore Inc?

Although Temasek frequently asserts it’s not a government directed policy agency and consequently does not enjoy any special privileges. The general held view suggest otherwise. Critics note GLC’s such as Temasek are simply a network of firms designed to operate in a protected market and it is through these agencies that the government exercises its will to either project regionally and internationally. As a result many do not see firms like Temasek as just another Asian conglomerate. At least not one that is sufficiently divorced from the government of the day to either act independently or autonomously without having to follow a national script. Such an assertion may even be preposterous. Nonetheless it continues to gain currency amongst conspiracy theorist who regularly confect a range scenarios ranging from phone tapping to stealing whole islands! One possible reason for the paranoia stems from the close links between firms like Temasek and Singtel to the families of the ruling elite. Again this does not necessarily suggest power resides in the hand of a few who may not altogether be inclined to act impartially. Any more than the Kennedy’s or the Rothchild’s have a secret agenda to transform America into a catholic fiefdom or Zionist Europe. The general perception of appearing “to close for comfort” to the ruling elite- real or imagined simply reinforces the belief – neighboring countries are not so much dealing with independent conglomerates as they are with the invisible hand of Singapore inc. Indeed, it’s one that militates against the long term strategic interest of Singaporean firms regionally. As it raises the question: can Singaporean firms even continue doing business in Asean amid this climate of suspicion? This would of course depend on calculating the actual cost of maintaining the status quo and much of the trade off analysis would hinge on whether the cost of redefining the relationship between firms and government, out weights the cost of maintaining the close nexus between them. Its one that guarantees an on going debate on how best to deal with the issue of reconciling doing what is right against what will be perceived as right.

(2). The Way Out of the Quagmire?

Against the backdrop an uncertain business environment; how do strategic planners grapple with the issue of the “perception” quotient in the context of managing businesses? Unlike numbers, weightings and factorials which are easily quantifiable. The perception quotient remains a qualitative abstraction. One which continues to confound both policymakers and businessmen alike as they struggle to make sense of how to project the right image – why is the perception quotient so important for Singaporean firms doing business in the region? Business isn’t just a simplistic notion of demand and supply. While that may well be a palpable truth in the book sense. In reality business in all its guises is simply an embodiment of the term “relationship” in a supra context. It’s one that encapsulates not only culture, history and values but also a “shared philosophy.” This sociological definition of business means people will invariably ascribe a name, face, nationality and even temperament to a firm. That’s the reason why the windows of Starbucks and McDonalds are regularly smashed by activist: they embody everything that symbolizes globalization. In the same way the American philosopher Theodore Rozak disparages Microsoft with his famous reference, “if you want to do what is good for kids, find out what Bill Gates wants to do in schools and do the opposite.” Here the firm, Microsoft is depicted as the evil empire one which aptly describes in Rozak’s view how technology represents predation. People create impressions about firms in the same way they form impressions about people, nationalities and races. People will continually seek out a sense of scale to define themselves alongside firms. Unfortunately much of the science related to strategic planning be it either in business or the enterprise of war continues to pay scant regard to the importance the perception quotient and even less to how it may even be managed. As a result even the best will continue getting it wrong as exemplified by George W.Bush in the Iraq war. When he naively said “all human beings want what we want – freedom,” to paraphrase: hence “democratization should be easy.” In reality, no one disputes, the Arabs may want freedom just like all of us. Only they don’t want to have anything to do with the American inspired variety. In the same way, our neighbors may want foreign investments. But they may not necessarily want or even feel comfortable with the Singapore inc variety. Does it make sense? No it doesn’t. Is it even remotely logical? No it isn’t. But does is it a scene that typically gets played out so often. It even suggest, they (our neighbors) are even prepared to cut their noses to spite us? Yes. As the Brazilian poet Augusto de Campos said, “hurt they will, but happy they will be no end, even as they bleed and make merry in the burning streets through the night…..” Against this backdrop of apparent senselessness, it forces us to ask: what do can Singaporean firm do to successfully navigate themselves through this labyrinth of competing desires? Again its one where neither sense or logic features in the discussion. That’s what’s so exasperating about having to manage the perception quotient – eventually, the question will turn on: Why do our neighbors succumb so readily to appeals based on the irrational forms of identity – ethnic, racial, religious – rather than to appeals based on the rational forms – economic and level headed state craft above all? Or, to put it in dramatic terms: why do identity politics so often rest on hatreds that do as much damage to the aggressors as to their victim? Until we have a deeper understanding of the answers to that question. We simply need to find a better way to conduct business with our neighbors. The question here do we simply fold our arms and say, well they should all calm down and take a stress pill? This approach denotes the expectation they will eventually come to their senses and hopefully do the rational thing. Or would it be wiser to take stock of these irrationalities and profile a set of countermeasures which allows us to make sense of the current divide? Again much of the calculations will depend on what the payouts would be if we do nothing against doing at least something. What then should we do?

(3) Its show time!

The challenge for firms such as Temasek in this new geo-political business environment requires them to take stock of the increasing volatile business climate in Asean. Firms have to consider the associated cost of being labeled as Singapore inc?

This would of course require them to also consider the derivative line of questioning: does being seen as Singapore inc foster mutual understanding and trust? Or does it simply exacerbate national resentment? If this question is answered in the affirmative, Singaporean firms especially GLC’s need to pursue independence and autonomy away from the government of the day as a matter of strategic priority. Pursuing a strategy decoupling from the government of the day will result in firms such as Temasek devolving into smaller strategic business units (SBU’s). Each operating autonomously from the nuclei of central control. Where soft power will feature increasingly as the preferred instrument of building and sustaining regional relationships – instead of cold, rational and metallic logic which typifies how the Singapore government comes across to our neighbors. The goal here being to define and allow smaller SBU’s to carve out their own identity outside the shadow the government of the day – in doing so they will be a better position to take corporate ownership of the perception quotient rather than being perceived as proxies. Hopefully even coming across as real conglomerates in the true sense of the word. Who are better prepared to navigate in a business environment that’s simply demanding Singapore inc to shed the image of parochialism, narrowness and insularity. Real or imagined, does it really matter?

Do we even have a choice?

(By Scholarboy & Astroboy / This Article Has Not Been Assigned An EP Code – Please note the “read” folder is down and will only be up some time around mid December. We will be re-routing much of the communication to conduct rehearsals for the staging the Olympics – expect frequent test from KOHO – meanwhile please log on as per normal WITHOUT using your book club read log in codes – Thank you – KOHO)

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4 Responses to “Why is Temasek, the Poor Little Rich Girl Everyone Loves to Hate?”

  1. […] Why is Temasek, the Poor Little Rich Girl Everyone Loves to Hate? […]

  2. scb said

    The buyer and seller are common in that they are all predators, can they be altruistic to each other ?

  3. […] of a Pink NRIC – Diary of a Singaporean Mind: The Disappearing Subsidy.. – Just Stuff: Why is Temasek, the Poor Little Rich Girl Everyone Loves to Hate? – The Universe Within: My mother is right – I should off all energy appliances WHENEVER I leave the […]

  4. sophie said

    Maybe because there is no shortage of volcanic problems within the Asean family?

    http://sophiesworld-sophiesworld.blogspot.com/2007/11/temasek-not-guilty.html

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