Thursday, 13 December 2012
How to Tap into Singapore's Deep Pockets
I wrote sometime back about the wealth of Singapore and how Africa can tap into this affluence for capital formation for development. Here is how.
Just follow the money trail and Singapore has lots of money and this could finance major projects. Here are a few sources.
High Net Worth Individuals
According to the Capgemini Merrill Lynch 2011 World Wealth Report Asia has 3.3 million high net worth individuals (HNWIs) with investible assets of $1 million and more are second in number to North America, and ahead of Europe for the first time. Some of these are based in Singapore and would be potential angel investors into African projects.
Singapore is a major financial centre that rivals London and New York plus is home to several commercial banks that many consider financing African projects.
Unlike commercial banks, development banks offer long-term finance and are ideal for mega projects.
Pension funds get more from pensioners and invest this into various investment vehicles like stocks, bonds are directly into a projects. These are managed by a fund manager who chooses the types of projects to invest into.
Property funds resemble pension funds except that these only invest into property either directly or indirectly.
Property developers are investors that specialise in developing properties that are later rented or sold.
Sovereign Wealth Funds
A sovereign wealth fund is like any other investment fund except it is owned by a government. Singapore has two sovereign wealth funds; Temesak Holdings and the Government of Singapore Investment Corporation (GIC). These has assets amounting to billions of dollars.
One way to raise finance is list shares on the Singapore Exchange. 200 international companies from over 20 different countries listed in Singapore since the early 1990s.
Singapore began life as a trading nation and today is at the centre of global trade. It is also home to commodity traders like Olam and Ning that invest into agriculture.
Singapore Business Federation
One way to linking with potential Singaporean business partners is through the Singapore Business Federation.