Singapore’s Project Finance Company

Tharman Shanmugaratnam

The Government of Singapore wants to advance the course of its local industries to emerging markets and transforming economies. Many countries assist local corporations expand through cross-border financing through state-owned export-import banks (EXIMs) and export credit agencies (ECAs). The United States has the Export-Import Bank of the United States. Japan has the Japan Bank for International Cooperation (JBIC), even China and South Korea has their own.

The Government of Singapore is addressing the country’s restricted capacity for big ticket and long-tenure project financing needs in cross-border financing. To address the issue, the Government of Singapore is pushing for the creation of the Project Finance Corporation (PFC). The PFC is expected to be operational in the latter half of 2012 and will be backed by a number of stable financial institutions, including Temasek Holdings. The PFC will also include Japan’s Sumitomo Mitsui Banking Corporation, Standard Chartered Bank PLC, and Singapore DBS Group Holdings Ltd.

Ultimately, the goal of the proposed PFC is to plugs gaps in the financing of larger, long-tenure overseas projects.

From a sovereign wealth fund investor (SWF) standpoint, this is a strategic endeavor for Singapore. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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