TNAG-2228-FCO40-3200-Political-relations-between-Hong-Kong-and-Singapore-1991 — Page 27

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Reference ...

CODE 18-77

LORD CAITHNESS VISIT: MEETING WITH BRITISH BUSINESSMEN, HONG KONG AND SHANGHAI BANK BOARDROOM, FRIDAY 3 MAY 1991

1. Lord Caithness received a first hand account from senior representatives of major British companies of their views on doing business in Singapore and the region.

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2. Mr Richard Hale, General Manager and CEO of Hong Kong and Shanghai Banking Corporation observed that Singapore was not an open market for banking. To protect local banks a ceiling was placed on the number of branches foreign banks could operate. The government wants outsiders to Singapore as a regional base for which it is well suited. It was best to start a presence in the region in Singapore, where for example there is no corruption, before starting up in Malaysia or Indonesia.

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3. Mr Bob Ashman, Managing Director of GEC Singapore felt there was a strong bias by the government towards Singapore companies when awarding contracts for prestigious projects. The best way for foreign companies to operate is through local joint ventures especially involving local manufacture GEC were proposing to do with Singapore Technologies in their bid for the Electronic Road Pricing (ERP) contract. This

not however necessarily price competitive. There was a shortage of electrical engineering skills in Singapore. For the ERP contract it would in fact be cheaper to manufacture equipment in the UK. Taiwan and Malaysia manufactured more cheaply than Singapore. but, if this option was considered on the grounds of price, manufacturing could be done in the UK.

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Mr Grea Harvey. Chairman and CEO of BP Oil SE Asia considered that with the high growth rates in the region anybody

serious about doing business internationally had to be here. Singapore had good engineers, but they did not come cheap. Educational standards were high but it was a competitive personnel market. BP actively recruited Singaporeans who were studying for second and third degrees overseas. Mobility was however a problem for international companies who wanted to broaden their Singaporean employees experience overseas. Generally wives work and do not want to move.

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