S’pore is tops in industrial competitiveness

Ireland and Japan came in second and third, according to a UN survey

SINGAPORE came out top in terms of industrial competitiveness, a United Nations (UN) survey has found.

The 2009 Industrial Development Report, which ranked 122 markets, said that the city-state took pole position in 2005 and 2000, based on an index that assesses national industrial performance across a five-year period.

Ireland and Japan came in second and third, while Switzerland, Sweden and Germany followed behind.

Developed by the UN Industrial Development Organisation (UNIDO), the competitive industrial performance (CIP) index considers factors such as industrial capacity, manufactured export capacity, industrialisation intensity and export quality.

In the report, UNIDO pointed out that the United States was the only mature industrial power that saw a deterioration in its relative position. This resulted from the improved performance of South Korea and Taiwan.

Among the top 60 countries, the largest improvements were seen in Qatar (up 23 places), Cyprus (18), Iceland (13) and Slovenia (10).

Among the bottom 60, several African countries, including Mozambique, Senegal and Cote d’Ivoire, improved their rankings considerably – by 21, 18 and 13 places, respectively.

Manufactured exports in those three countries grew much faster than manufacturing value added (MVA), while the share of primary exports in total exports declined sharply.

East Asia leads the developing world in the CIP index, where the four mature ‘tigers’ continue to dominate the rankings.

However, Hong Kong has dropped in industrial competitiveness, while China continues its impressive performance and is in 26th position in the 2005 ranking.

Sub-Saharan Africa lagged behind all other regions. Most of the region’s countries cluster at the bottom of the CIP index.

Latin America continued to lose ground to East Asia. The best three performers in the region – Mexico, Costa Rica and Brazil – lost several positions in the rankings.

South Asia does not perform well on the CIP measure. India leads the CIP in the region but lost three positions in the global rankings, despite its strong information technology and electronics sectors.

In the Middle East and North Africa, Tunisia and Morocco continued to improve in industrial competitiveness.

They have emerged as small dynamic economies and are able to compete in global markets not only in basic manufacturing, but also in sophisticated products.

Source : Business Times – Feb 2009

Alexis at Alexandra pulls in the punters

PREVIEW sales of the 293-unit Alexis at Alexandra Road started yesterday and developer Fission Group said that at least 50 per cent of the development has been sold at prices ranging from $850 per square foot (psf) to $1,100 psf.

The company was coy on the exact number of units sold but it may have been a tad too modest. Some buyers BT spoke with at the crowded show flat said that they were told by marketing agents that up to 85 per cent of the units had been sold by 7.30 pm.

‘The prices are competitive compared with other condominiums, but its proximity to the MRT and CBD makes the Alexis a good investment,’ said Steven Kwok, a potential buyer who had been quoted a price of $1,050-$1,100 psf.

Another buyer said that compared to the recently launched Caspian ($580 psf), Alexis is not cheap but he hopes to resell the property for a profit. He also said that compared to what was quoted in an invitation he had received earlier, prices quoted at the showflat were 10 per cent higher.

According to official data, three units at The Anchorage next door sold at $848-$929 psf in the fourth quarter while a unit at Queens on Stirling Road sold for $894 psf this month.

Fission Group has tied up with United Overseas Bank to offer an interest absorption scheme, which, like the now-scrapped deferred payment scheme, allows buyers to defer any payments beyond an initial downpayment until the project receives Temporary Occupation Permit (TOP).

Alexis is being built on the former Alexandra Centre which was put up for collective sale in 2007 for around $300 per square per plot ratio. It is not known how much Fission Group paid for the site.

A seasoned property consultant said that interest in Alexis is likely because most of the units are small. At between 400 sq ft for a one-bedroom unit and 650 sq ft for a two-bedder, prices range from $450,000 to $650,000.

He also said that there was ’still liquidity in the market’ and investors with a two-year investment horizon would still find property attractive. ‘There is no point putting money in a bank,’ he added.

Over on the east coast, City Developments Ltd (CDL) will launch a new phase for its Livia condominium in Pasir Ris at an average price of $620 psf, or about $30 psf less than the launch price of the first phase. A total of 30 units in two stacks will be offered in the second phase.

Chia Ngiang Hong, group general manager of CDL said: ‘The company senses a renewal of market interest and improvement in buyer sentiment. More people have been visiting our showrooms, and many have made offers for units that have yet to be launched.’

Source : Business Times -  Feb 2009

First phase of Caspian going for $580 psf average

Frasers Centrepoint is pricing the first phase of its 99-year leasehold Caspian condo next to Lakeside MRT Station in Jurong at an average of $580 per square foot after discount for buyers who opt for normal progress payments.

Those who choose the developer’s interest absorption scheme will pay 3 per cent more, or an average price of about $598 psf.

The pricing for the 250 units, which are spread across the project, is considered competitive and reflects Frasers Centrepoint’s strategy of pricing to sell in the current recession.

Next to Caspian, units at Lakeholmz, which was completed four years ago and also developed by Frasers Centrepoint, are selling at about $600 psf on average in the resale market.

Further away, units at The Lakeshore are fetching about $750 psf on average and developer Far East Organization is understood to have held back some choice units facing Jurong Lake, presumably for sale later to ride on the government’s plans for the district.

Frasers Centrepoint is optimistic of good take-up for Caspian. ‘We’ve received strong interest from prospective owner-occupiers and even investors, who are now more keen to invest in brick-and-mortar property than risky financial instruments, especially if the property has a great potential upside to it,’ said Frasers Centrepoint Homes chief operating officer Cheang Kok Kheong yesterday.

‘Potential buyers will see Caspian’s price range as attractive and offering value for money.’

The project will have 712 units in total and is coming up on a site that Frasers Centrepoint bought in late 2007 for $248 psf per plot ratio. Analysts reckon that Frasers Centrepoint may barely be making money, based on the first-phase pricing.

BT understands that the project’s private preview is slated for tomorrow, to be followed by the public preview over the weekend.

‘The idea is probably to raise prices for the later phases to turn in a profit for the overall project,’ a market watcher said.

For the first phase, prices of typical two-bedroom to four-bedroom (with study) units range from $540 psf to $640 psf. The average price for a studio unit is about $350,000.

Source : Business Times – Feb 2009

Make hay while rivals are debt ridden, investors urged

 

Swift global price slide creates slew of opportunities

Equity-rich investors have enough firepower to revive the world’s catatonic property market but only if they stop hiding behind forecasts and make the most of their temporary advantage over debt-driven peers, experts said.

Delegates at Thomson Reuters’ annual Global Property Outlook event on Tuesday were urged to grab the slew of opportunities already created by a swift worldwide property price correction and in doing so, take more control over the length and depth of the downturn.

‘The best way to predict the future is to reinvent it,’ said Joe Valente, head of portfolio management and strategy at Allianz Real Estate, using an expression first used by technology mogul Alan Kay.

‘The old adage that investors are just a bunch of sheep is not too far wrong… but there are also a whole series of people who take what’s out there in the landscape and refuse to believe it…to them the future is something you actually create.’ Mr Valente said property prices would continue to fall for at least another year but long-term investors like pension funds and insurers should consider buying now if they want to fully exploit a repricing that has so far slashed around a third off commercial real estate values in Britain, the market broadly seen as most advanced in its correction.

He said global real estate markets were always prone to swings in sentiment which led to irrational pricing and that the current bout would continue to unwind over 2009 and 2010.

‘At each point in a market cycle, there’s a new emotion and with each new emotion, pricing moves. London is somewhere between despondency and depression…and should be the first out of the recession,’ Mr Valente said, adding he felt Paris and Germany were still in denial.

Tim Bellman, global head of research and strategy at ING Real Estate, told delegates he felt the global property markets should touch bottom in 2009 and there was potential for positive growth in 2011 and 2012. ‘By 2010, the capital value decline by and large should be behind us.’

‘Around the world, we would expect retail and industrial property to perform slightly better and recover slightly sooner,’ he added. He flagged continental Europe and parts of central and Eastern Europe as the more defensive places for investors to park cash in the near term, largely because of a tight supply pipeline that would promote strong rental growth when economies bounced back.

He advised ‘a mild, tactical underweight to the Americas’ and said Asian markets had greater downside risks because real estate prices in parts of the continent tended to ‘double and halve at the drop of a hat, particularly in Hong Kong and Singapore.’

Mr Bellman encouraged investors hunting for buy signals to remember traditional methods of pricing real estate and choose assets offering a healthy risk premium of between 250-400 basis points over the local risk free rate. By 2010, Mr Bellman said Britain, France and Japan – followed slightly later by Germany, Canada and the Netherlands – would have experienced corrections sharp enough to create an appealing risk premium between property yields and government bonds.

But Mr Bellman said equity investors had little time to waste in snapping up the highest quality distressed assets before a recovery gathered momentum.

Source : Business Times – Dec 2008

Asian property markets on investors’ radar

 

Top picks are Japan, Australia, China, HK and Singapore

Asia’s battered property markets are starting to attract strong interest from investors, with Japan, Australia, China, Hong Kong and Singapore among their top picks in the region.

Property fund manager LaSalle Investment Management, which raised a US$3 billion fund in August, expects Hong Kong and Singapore to recover first from the financial turmoil.

Said regional director David Edwards: ‘We are seeing a decline in values throughout the region. There are properties that are being sold at much lower prices than the market’s perception of their values.’

ING Real Estate plans to double its investments in Asia to US$1 billion, with most of its investors in Europe wanting to diversity into the region, said the firm’s Asia-Pacific managing director, Nicholas Wong.

ING invested mostly in China and Japan, he said, and was now marketing a US$750 million fund to build Chinese housing. Several Asian markets were already 30-40 per cent off their peaks, he said.

And a Reuters poll last week found that analysts believe that Hong Kong and Singapore prices are set to fall by at least a fifth in the next year.

‘Most of our clients are from the UK and Europe and traditionally, they invest only at home,’ Mr Wong said. ‘Now, they want global exposure and most of them want to go to Asia for diversification.’

With Hong Kong, Japan and Singapore in recession, Asian developers are battling falling demand and tighter credit, even after efforts by central banks to encourage lending by slashing key rates.

In Hong Kong, the de facto central bank has lowered its base rate twice in the last month, while in China, monetary authorities have cut borrowing costs three times since mid-September.

‘The risk of bankruptcies are still higher throughout Asia and most financial institutions are not out of the woods yet,’ said Kelvin Lau, economist at Standard Chartered Bank. ‘That’s why overall lending conditions have not yet returned to normal.’

In Japan, more than 400 small and medium-sized developers have gone out of business this year as the residential market slowed and as credit dried up. But the tough environment is not stopping property investors from prowling the region for bargains.

‘The present environment is incredibly difficult. As a business, we are taking a cautious approach. But we are still looking,’ said LaSalle’s Mr Edwards.

LaSalle has so far invested US$10 billion in Asia and nearly half the amount is in Japan, he said. The company is also keen on Australia and China, he added.

Other investors were optimistic that some property segments would recover soon. China’s ailing housing market, for instance, may stabilise in about six months and recover in two years, before most other Asian countries, said Cheng Soon Lau, managing director at Invesco Real Estate Asia.

Invesco is planning to invest directly in China, Japan, Hong Kong and Singapore, buying office blocks and building housing.

Managers of securities funds are becoming less worried that investors will withdraw money, according to Chris Reilly, director of property for Asia at Henderson Global Investors. ‘Right now, there is really not much redemption,’ he said. ‘The cycle of redemption was more severe in the last 2007 and early 2008, the period when retail investors are quite scared.’

Business Times -  Nov 2008

Singapore slips on Monocle ranking

 

SINGAPORE now ranks 22nd on Monocle magazine’s World’s Top 25 Most Liveable Cities list, down from 17th position a year ago.

Monocle is a global affairs, business, culture and design magazine set up by Tyler Brule, formerly editor of influential lifestyle magazine Wallpaper*.

While Singapore scores high in some aspects of liveability, including the efficiency of Changi Airport, Mr Brule said that its 2008 ranking suffered from ‘tolerance issues’.

In Singapore to speak at ArchiFest 08, he said that there are three main ingredients to a liveable city: ‘density, diversity and design’.

While Mr Brule did not elaborate on the ‘tolerance issues’, he said that communities need to be able to ‘breathe’ and ‘you have to take the good with the bad’.

Monocle’s ranking goes beyond the usual metrics that only look at factors such as housing costs and the availability of schools.

It also looks at softer issues such as the possibility of getting a good glass of wine at one o’clock in the morning; the quality of new architecture; the ease of setting up a business and even the number of cinema screens per city.

For instance, Monocle found that 5,000 businesses start up in Copenhagen every year while Paris has 376 cinema screens.

Global transport connections; communications; innovative environmental initiatives; a low crime rate; attractive architecture and strong public services help cities advance up the list.

Poor urban planning, crime, disconnected transport links and a lack of urban village life all count against.

Mr Brule also said that liveable cities have to ‘evolve’. As such, 2008 saw a shake-up in the rankings, with Copenhagen usurping the top spot, pushing Munich one place down.

Tokyo also moved up one spot to take third place.

More significantly, there were six new entrants – Berlin, Fukuoka, Amsterdam, Minneapolis, Lisbon and Portland – to the Top 25 list. Auckland, previously in 16th position, was among those that were pushed out altogether.

Mr Brule challenged some notions of liveability. For instance, he noted that while environmental initiatives which remove cars from the streets can do wonders to curb toxic emissions, it can also kill whole neighbourhoods by depriving shopowners of passing trade and leaving districts feeling lifeless and menacing.

He said that governments worldwide are realising that it is no longer enough to be just a financial centre, and that it is also important to be a design capital.

Design does not need to be a big-ticket item either. It just needs to instil ‘a sense of wonder’, Mr Brule said.

Highlighting a small public toilet designed by Pritzker Prize winning architect Tadao Ando in Omotesando Hills, Japan that moved him, Mr Brule added: ‘You don’t need a ferris wheel. You just need a great place to pee.’

Business Times – 14 Oct 2008

S’pore is 4th cheapest place to raise expat kids

 

40% of foreigners polled say it is cheaper here than in their countries

A GLOBAL survey has found Singapore to be among the countries where it is cheapest for expatriates to raise their children.

Singapore emerged fourth cheapest, after Spain, India and China, in a survey by HSBC Bank International of 870 expatriate parents across 14 places. In the poll, the cost of raising a child included – but was not restricted to – the cost of education.

Almost four in 10 of those in Singapore who were polled said it was cheaper raising junior here than in their home countries.

Another 25 per cent said the cost was ‘about the same’.

At the other end of the spectrum, Britain, the United Arab Emirates and Hong Kong are the most expensive places to raise children.

The survey also asked these expatriate parents to rate the countries they are living in, in areas such as the amount of time their children spend studying and being outdoors, and whether they think their children will remain in their adopted country upon growing up.

Using these criteria, Singapore came out tops in Asia and fifth on the list of 14 places for expatriates to raise children. It lost out to Spain, France, Germany and Canada in the ranking of the 14 places. Within Asia, India was second but eighth on the list of 14; China was third in Asia and ninth on the list.

Australian publisher Katrina Bingham-Hall, 43, who arrived in Singapore five years ago, is bringing up five children aged between four and 14.

With the older four attending government schools here, she spends less than $1,000 a year on their school fees, and is all praise for how little the ‘brilliant’ education system here costs.

Back home, it would cost her about $700 a year to put just one child through public school.

She added: ‘Singapore’s education system is streets ahead of Australia’s. The teachers here are far more dedicated and the education standards are far better.’

As for American Tracy Waychoff, 46, she chose Singapore when her husband was offered a choice of postings here and in Brazil, China and Mexico.

The mother of two teenagers said: ‘I know my children will be safe in Singapore and drugs are not a concern.’

Straits Times – 11 Oct 2008

Singapore is ‘fifth most competitive economy’

 

It moves up 2 places in WEF survey; Hong Kong up one place to 11th

SINGAPORE has climbed two notches to fifth place in the World Economic Forum’s (WEF) latest global competitiveness index, distancing itself from the other Asian economies.

The annual survey, released last night, showed that the next most competitive Asian economy – Japan – had dropped to ninth from eighth spot.

It was only last year that Singapore overtook Japan in the annual ranking, which polled a record 12,297 business leaders in 134 economies this year.

Perennial business rival Hong Kong improved one place to 11th.

In the survey, economies were assessed according to 12 ‘pillars’ of competitiveness, ranging from infrastructure and macroeconomic stability, to business sophistication and innovation. These are weighted for each economy to reflect their stage of development.

Singapore’s improved ranking was reflected by its strong institutional environment that came about as a result of a strengthening across all aspects of the institutional framework.

It has the best ranking of all economies in terms of public trust of politicians, wastefulness of government spending, burden of government regulation and transparency of government policymaking.

It was also ranked among the top two countries for the efficiency of all of its markets – goods, labour and financial – ensuring proper allocation of these factors to their best use, the survey said.

‘Singapore also has world-class infrastructure, leading the world in the quality of its port and transport facilities.’

It scored high in other indicators as well, such as higher education and training, and technological readiness.

On the flipside, its overall ranking is constrained by its small domestic market and mixed performance in the macroeconomic stability pillar, where it ranks 59th and 121st respectively for its interest rate spread and government debt.

Respondents also cited inflation as their biggest bugbear for doing business in Singapore.

Notwithstanding the current financial crisis, the US retained its position as the world’s most competitive economy.

The survey was conducted between January and May this year, which means that the index does not reflect the worsening global crisis.

But Ms Jennifer Blanke, senior economist of the forum, said the index aimed to take a longer-term view, and on that basis, the US ranking was fully justified, Reuters reported.

The US scored highly as it is endowed with many structural features that make its economy extremely productive. This places it on a strong footing to ride out business cycle shifts and economic shocks.

Despite rising concerns about the soundness of the banking sector and macroeconomic weaknesses, the country’s many other strengths continue to make it a very productive environment, the survey noted.

On the other hand, the business costs of terrorism, crime and violence are points of concern.

But the country’s greatest weakness is its macroeconomic stability, where it ranks a lowly 67th overall.

Its burgeoning levels of public indebtedness – at more than 60per cent of gross domestic product -suggest that the US is not preparing financially for its future liabilities. Interest payments will increasingly restrict its fiscal policy freedom going into the future, the survey warned.

In second, third and fourth places were the Northern European countries of Switzerland, Denmark and Sweden, rounding off an unchanged top four.

China continued to climb up the charts – up four places to 30 – helped by its large market and strong economic performance.

Ninth-ranked Japan has a major competitive edge in the areas of business sophistication and innovation.

Its overall performance, however, is dragged down by its macroeconomic weaknesses, with an extremely high budget deficit (ranked 110th), which have led to the build-up of one of the highest public debt levels in the world (ranked 129th).

As for Hong Kong, it is ranked first for its legal rights, capital flows and access to financing via the local equity market.

But its small domestic market size and mixed performance in the areas of health and primary education, as well as higher education and training, were a drag on its overall ranking.

Straits Times – 9 Oct 2008

S’pore overtakes HK in financial centre ranking

It’s 3rd globally, behind London and NY, with biggest gain of top 20

Singapore has been ranked third in The Global Financial Centres Index (GFCI), behind London and New York, according to a new report published by the City of London.

Singapore gained 26 points in the index, more than any other top-20 centre, which allowed it to overtake Hong Kong. Hong Kong has been ranked fourth this time round.

The GFCI is updated every six months in March and September. This report is the fourth edition.

London and New York still lead the field and ‘continue to be the only two truly global financial centres’, the report said. Both cities, hit by the credit crunch, shed points in this round of the GFCI. But London’s lead as the main banking centre in Europe is consolidated as Frankfurt and Paris have both declined in the ratings relative to other centres, the report noted.

In Asia, Singapore surged past Hong Kong to move into third place overall, albeit by only one point.

Singapore’s 26-point gain also means that the gap between London and New York, and the third place centre fell to 73 points, from about 90 points in previous rankings. Singapore is just ahead of Hong Kong in the banking, insurance and government & regulatory sub-indices and is also ahead in the business environment sub-index. But Hong Kong continues to thrive, the report said.

The GFCI also noted that financial centres in the Middle East continue to generate a lot of interest. Dubai is identified most frequently by respondents as the centre likely to become significantly more important in the next few years; Singapore is second in this respect.

Dubai is also the centre mentioned most often when respondents are asked where their organisations are most likely to open offices in over the next few years.

The GFCI model rated 59 financial centres in this round. The study uses external instruments – such as the United Nation’s Human Development Index and the World Bank’s Ease of doing Business Index – as well as responses to an online questionnaire from 1,406 financial services professionals.

Business Times – 26 Sep 2008

S’pore still least corrupt in Asia

JUST like last year, Singapore has been ranked the fourth least corrupt country in a global corruption survey.

It also retains its status as Asia’s least corrupt country on the Corruption Perceptions Index, released yesterday by Transparency International (TI).

Conducted annually by the Berlin-based non-governmental corruption watchdog, the index studies the level of public sector corruption in 180 countries and ranks them according to scores. A score of 10 indicates highly clean and 0 means highly corrupt.

It defines corruption as the abuse of public office for private gain and measures the degree to which corruption is perceived to exist among public officials and politicians.

In this year’s index, Singapore scores 9.2, behind joint-leaders Denmark, Sweden and New Zealand, all of which obtained a 9.3 score. At the other end are Somalia (1.0), Iraq and Myanmar (1.3) and Haiti (1.4).

Asian economies which placed significantly are Hong Kong (12th), Japan (18th), Taiwan (39th), South Korea (40th) and Malaysia (47th).

Last year, Singapore was ranked joint-fourth with Sweden, behind Denmark, Finland and New Zealand. It came in fifth from 2003 to 2006.

Dr Johann Graf Lambsdorff of the University of Passau in Germany, who draws up the index, said Singapore’s long tradition of strong oversight is an example for best practices in Asia.

Mr Liao Ran, TI’s senior programme coordinator for East and South Asia, said factors contributing to Singapore’s ranking included a strong commitment from political leaders; education, which has bred a culture of integrity among citizens; a sound and comprehensive legal framework; and an effective anti-corruption agency.

TI said the index continues to show there is a link between corruption and poverty. It also underlines the benefits of fighting corruption.

‘Evidence suggests that an improvement in the index by one point increases capital inflows by 0.5 per cent of a country’s gross domestic product and average incomes by as much as 4 per cent,’ Dr Lambsdorff said.

TI also said the index shows that wealthy countries such as France and the United Kingdom, whose scores have slipped, need to step up their anti-corruption mechanisms.

Professor Neo Boon Siong, director of the Asia Competitiveness Institute of the Lee Kuan Yew School of Public Policy, said Singapore’s fourth position was a significant achievement.

A good ranking helps attract investments as it makes doing business here more predictable and cheaper, he said.

As to whether Singapore can reach the top of the index, he said: ‘The real difference among the top leaders is not very wide. The actual ranking itself is not the main issue, because being ranked among the top few is a clear recognition the country is corruption-free.’

The index is computed with data from 13 corruption-related polls and surveys carried out this and last year by institutions like the World Economic Forum’s Global Competitiveness Report.

Straits Times – 24 Sep 2008