Wednesday, 30 September 2020

Rolf’s Thoughts: How Is Keppel Going to Monetize S$17.5 billions and Revamp It’s O&M Business?

Keppel share price has been badly battered down lately. The share price need a boost and it came from a news from Keppel’s CEO last night, that billions of dollars of assets could potentially be monetized over coming years. 

Source: CNA excerpts: “SINGAPORE: Singaporean conglomerate Keppel Corp said on Tuesday (Sep 29) it had identified assets worth S$17.5 billion that could potentially be monetised, including through sales, and started a review of its loss making offshore and marine (O&M) business. 

The plans unveiled on Tuesday are part of Keppel's 10-year strategy that it had flagged earlier this year to refocus its portfolio to energy and environment, urban development, connectivity and asset management. Keppel said it was exploring options including strategic mergers and disposals for its offshore and marine business, which builds oil rigs and has been battered by falling energy prices.”

My thoughts below…

Disclaimer: Please note that the below post comprises solely of my own opinions and does not represent in anyway concrete information or comments from the company or from the press. I cannot guarantee the accuracy of the information contained herein, and it shall be intended to be used and must be used for informational purposes only. Please refer to the disclaimer tab of this website for more information. 


Keppel also states that they are exploring both organic and inorganic options for the strategic review of their O&M business (KOM). Organic options include reviewing the strategy and business model of Keppel O&M, assessing its current capacity and global network of yards and restructuring to seek opportunities as a developer of renewable energy assets; while inorganic options would range from strategic mergers to disposal.

INORGANIC : Strategic Mergers or Disposal

The fastest way to monetise is of course inorganic. i.e. mergers and/or disposals. Obvious option will be to merge with SCM. However why did Keppel also need to consider option of disposal O&M business? 

The simple reason is because it is not as easy to consolidate two major players within a particular segment, just like what “layman investor” think as a snap of finger “Ok.. let’s merge and unlock value for investors and business will prosper”. It is not as straight forward and there are many pros and cons or barriers to KOM-SCM merger. 

Read my earlier articles : 

Will Keppel Offshore & Marine and Sembcorp Marine Merge? 

To Merge Sembcorp Marine and Keppel O&M is NOT up to Temasek and Shareholders alone? Anti-competition Authorities may REJECT!

While most of us are just thinking about merger with SCM, but there are always other options. For instance KOM can be taken private and solely owned by Temasek, or together with some other strategic funds or companies. Or perhaps merge with other Temasek-owned O&G company such as Pavilion Energy that is focused on LNG and having synergy with Keppel’s O&M business. Anyway KOM’s major order backlog today are in gas related solutions. 

Otherwise, there are also possibility of selling KOM businesses in parts if not wholly, such as disposal of Rig business, Floatel business, FPSO business, Marine business, Renewable business, Proprietary Designs, Repairs business, Defunct KrisEnergy? etc. 

Keppel can also consider to dispose some rigs they owned via “sale and leaseback “deals. This means Keppel selling the rigs to a “fund/company” and then lease it back  long term on day/month/year rate at a percentage of interest higher than the selling price. However this is only possible if they manage to find a long term charter for the rigs, or making partnerships with Oil Companies and/or Rig Contractors. Current environment of low oil is tough to find long term charter for Rigs, but within the next few years if situation improves, there can be higher possibility. 

The same “sale and leaseback” can also apply to O&M yards they owned, although Keppel mentioned the unlock of 17.5B does not include the O&M yards that are considered as fixed assets. 

ORGANIC : Developer of Renewable Assets

Renewables mainly means Wind, Solar or Hydro. And from the top of my head, I guess it is mainly Wind and Solar businesses. 

If we look at Keppel’s latest 1H2020 presentation (refer here), net order book for O&M is S$3.5B, and bulk of it comes from Gas solutions comprising of 2.1B, while renewable backlog is a mere 0.6B. Hence pure organic growth by wining orders is not going to be easy.  

Therefore, when Keppel said to be a developer of renewable assets, I think they probably mean options of taking ownerships wholly or partly via strategic partnerships of Offshore Wind Farms or Solar Farms and developing it into a viable income generating assets, rather than wining EPC contracts for Renewables. 

 Source: Keppel’s 1H2020 Financial Results 30 July 2020

For example in Offshore Wind, you have Danish MNC giant Orsted being the world’s largest developer of wind energy accounting for close to 30% of the global installed capacity in wind energy, investing into Wind Energy in Taiwan now. At the moment, Offshore Wind especially in Taiwan, Vietnam, Japan, Korea, and North Sea region are hot spots of potential projects in near future, as governments and authorities are hungered for more clean energy. 

For Solar, you can look at businesses such as India’s Adani Green Energy Limited (AGEL) that Keppel may try to emulate. The company operates Kamuthi Solar Power Project, one of the largest solar photovoltaic plants in the world. AGEL also won the world largest solar project amounted to USD6B by Solar Energy Corporation of India to build a 8000 MW photovoltaic power plant. Another company in the Solar business space is GCL New Energy HQ in China but listed in HK. 

That said, developer of Renewable Assets is long term business and requires a lots of upfront investments and developers will also face complexity in dealing with governments of countries where the Assets are. 


Aside from O&M, Keppel other range of business are from telecommunications to property development with assets to be monetised over the next few years. These assets include the group’s landbank which is held at historical cost, development projects, investment properties, assets being developed and stabilised for monetisation through Keppel-managed or third party platforms, various funds and investments etc. 

One disposal candidate is likely to be M1 that Keppel and SPH co-owned, and was taken private in 2019 valued at S$1.9 billion back then. 


If you look at KEPPEL 2030 VISION (slides here), it is clear that the company want to be asset light and they have clear focus of recurring income. 

The current O&M businesses revolves around Rig and shipbuilding contracts that are normally one-time businesses and are very competitive. Guess this is definitely not part of their 2030 vision. I think Keppel will be looking to gradually scale down or divest this part of the businesses, which they already did after the oil crisis. 

The new Energy business model that Keppel is targeting is likely to be one that can provides recurring income stream, stemming from ownerships of Energy / Renewable assets that produces oil and gas or generate energy (i.e. GW). 

In the process, KOM will also have the business units (BU) or expertise to support the developments of these assets. They will probably keep other asset lighter O&M businesses with higher margins, such as repairs and conversions, or selling of offshore equipment, if they are not going to divest the entire O&M businesses. 

The inter-BU cross selling is also part of the 2030 vision with common support and share services that have very little overlapping, optimising the business. 

Keppel’s vision is very much investment driven. This is not surprising at all, considering their current CEO comes with a GIC and investment background.  

I am a shareholder of Keppel at the time of writing. If you ask me if Keppel will be successful going forward and bring more shareholder value, my answer is likely to be yes! If you then ask me, is Keppel share price cheap now? My answer is yes again. 

So will I buy more? Then you need to ask yourself if there are other cheaper and more attractive shares? 



Rolf’s Thoughts: Keppel (the son), Hoping for Temasek (the father) 's Partial Offer?

Will Keppel Corp and DBS support the defunct KrisEnergy’s fund raising?

Keppel Corp – How Much Do You Know About Her O&M Businesses?

Rolf 's Insight : Sembcorp Marine Rights Issues to raise SGD2.1B in a demerger deal with Sembcorp Industries

Sunday, 27 September 2020

Is "NOW" The Right Time To Invest?

My foreign colleague out of nowhere asked me last week if “NOW” is the right time to invest?

Many seasoned investors will tell you there is no right time to invest. You should just “start” investing young, and the longer you are invested in the market, the better the investment. THIS IS TRUE!  

Nonetheless, it is not fair to totally discount when to invest? For instance, is it better to invest before Covid End 2019 or now? The answer is straight forward.  

Then there is another school of thought, that I am waiting for the stocks to fall further before buying? This is plain silly. You cannot predict the bottom! 

Rewind a decade or more, let’s say end 2007 just before GFC, you invested in Dow at 14K and Nasdaq at 2.8K. Back then, you will probably go berserk after your investments!  This is because Dow and Nasdaq will continue to fall until they bottom at 7K and 1.4 respectively. 

However, if you have the stomach to withstand the crazy GFC crash and not sell your stock until today, Or better still, you kept accumulating regularly throughout 2008 and 2009, your investments will be multiple baggers today! Dow is 27K and Nasdaq is close to 11K as we speak. 


Consider if your income is still stable and you are pretty sure that it will be unwavering for the foreseeable future, AND you have excess cash after keeping “rainy day e-expenses”, then you DEFINITELY SHOULD INVEST NOW.

Whether it is the best time to invest, I don’t know, but it is definitely a good and right time to invest.  

You may hear many of your investing friends said…. “aiyah” I wish I can throw all my life time of savings into stocks Mid-March when Dow went below 20K, Nasdaq below 7K. 

If you do that, that is plain stupid! 

And you are gambling your entire fortune, without knowing what is going to happen, back then. Of course now, it is easy to say things like “I could have”, because things already happened now and you know stocks have since charted upwards since April. What if stocks continue to fall more than 50% after April? 

From end March or early April this year, it is better to do nothing and wait for the dust to settle, or at least accumulates investment gradually and regularly. That is what I have been doing. 

Yes, you did not catch the bottom but that is a more sensible thing to do. 

Read what I wrote in April : What Should I Do in Stock Market Now?

Now that the worst has already take place for more than six months, I doubt we will re-test the Mar low. I said I doubt, but I cannot be certain as I do not have a crystal ball to see the future. 

One thing for sure is at least the dust is more settled now than in Mar/Apr. And I am making sense from the general mindset of people, that, once a crisis take place unexpectedly, human nature is we will be more risk adverse and will tend to prepare better for the worst later. This means we are unlikely to be caugth by Covid second wave or the impact of the US general election, as investors have already taken that into account when they invest now. Also, the same type of crisis rarely takes place twice in a very short period of time. 

Read what I wrote in August : Why Even a Covid-19 Second-Wave Will Not Crash the Stock Market by Much?

Therefore, I reckon that it is a good time to invest NOW! 

The other questions are: 

“How to invest”? and 

“Where and What Stocks to Invest”? 

I will address these questions in my subsequent post(s). Stay tuned…. 

Saturday, 26 September 2020

Rolf’s Household Expenses to Household Income

This is first time since I started blogging to publish data related to my household expenses. Below are data reflecting the percentage of My Household Expenses to My Take-Home Household Income. The data is compiled from year 2014 to c2020 (forecast), and below pie chart depicts the average data over the last seven years. 2020 data is accurate up to August and the rest of the quarter is estimated on a relatively conservative basis. 

Gross Take-home household income – Me and wife are the two earners in a larger than usual household. The values here shown our Salaries excluding CPF contributions, AND ANY other incomes, such as property rental, professional writing, blogging income etc. 

All the rest of the expenses are taken as a percentage of the Gross Take-home household income. 

Taxes and Deductibles – This includes personal income taxes, property rental taxes, as well as related rental property expenses (e.g. repairs, furniture, agent commissions, etc). The 3% tax is mainly contributed by my income tax and our rental property tax, as my wife’s income tax is negligible due to a lot of reliefs. The value could have been higher, if not for forty thousands of baby’s birth tax relief received during this period.  

Personal Expenses – This include food and entertainment expenses spent personally or with friends, as well as outlay on personal apparels, hobbies, gadgets etc. It also includes personal insurances, medical and dental expenses etc. In general, our personal expenses are considered low, at a combined of 9% (i.e. 3% for Rolf and 6% for wife). This is because we mostly eat home-cooked food, except for weekend spent with family that are included under Household expenses. We rarely spend on ourselves, except for special occasions such as birthdays or anniversary, but both wife and me do catch up with friends regularly for a drink or meal outside. Also, my hobbies are cheap, such as gym, table tennis, swimming, reading, writing etc. 

Car Expenses – This expenses are all related to our one car at any one time clocking high double digit percentage expenses. It excludes wife’s, children’s transport expenses etc.  My car expenses are rather high during the period of 2014 to 2015, when I owned rather expensive first hand car. From 2016 to 2019, expenditure is for full payments of cars, repair costs and 10 year COE renewal. The full payment in 2019, also mean that 2020 car expenditure is a mere less than 1% and expected to continue stay low in the coming years.  

Property Expenses – This includes Cash portion of monthly mortgages paid, but excludes any lumpsum payments of property loan, or regular mortgage payments via CPF. Property tax for “own stay”, fire insurances, condo miscellaneous fees etc are taken into account as well.  12% average for mortgage plus associated expenses are definitely considered low, considering we have more than one property. Note that I am very conservative in my property leverage, and my loan period is kept within a decade. 

Household Expenses – Undoubtedly this is the largest expenses each year. It is inevitable due to our large household members under one roof. The largest portion is household food and groceries, our helper’s expenses and extra pocket money to my parent/parents-in-laws. Due to my large relatives and friends base, a significant portion of this expenses also comprises of spending for special occasions such as CNY, wedding, baby showers, birthdays, wakes etc. This year household expenses could have been lesser and not 22%, if not for a sum of 20K accrued for partial renovation of my house, that was put on hold due to Covid. I intend to continue in the coming months or perhaps next year. 

Children Expenses – This is another big part of our spending accounting for 11% of our take home income. The baby bonus and CDA top ups do give some reliefs especially on the very high education fees in Kindergarten. I expect this expense to increase as our kids become older due to more expensive enrichment, tuition and sports classes and more pocket money.   

Vacation – 2% is very low in my opinion, in comparison to many of my friends who almost travel as a family every year to expensive places such as Japan, Europe etc. The expenses incurred are mostly vacation with my wife in Taiwan, Bali and Malaysia and some of the business trips she tag along with me to the Western Hemisphere. 

I am not stingy to spend on family travel, and the lower expenses is due to kids still of young age in the past, the cheaper staycation expenses. My busy work-travel schedules also meant lesser time for vacation. That said, we do have family travel to KL Genting, staycation in Singapore that are equally enjoyable, and in 2019, we went for a big family vacation in Australia and I really spent a fortune of more than 20K. Bearing in mind that when we travel as a family, we normally need to book 2 or 3 rooms or suite and not just a small family of four that definitely has much lower expenses. This year’s vacation expenses will be greatly reduced due to Covid-19, but I have already catered a small sum for year whole family staycation. 

Charity – This includes regular and lumpsum disbursement to charitable organisations or to families (not relatives) we know who are poor and in need of support, as well as pocket money for my niece in overseas university. From 2014 to 2016, I did spend on charity but the amount is negligible in percentage and was omitted. From 2017 onwards, we began to spend more for charity, with outlay of 2-4 percentage per annum. 

In reality, the amount is definitely higher, as I have considered money that was shove into the pockets of my relatives, as household expenses. We also held several charitable house gatherings of 20 or more in the past, that we provided free food, and this was also included under household expenses. 

Savings – Average Savings stand at 25%. I think it is a decently good figure. This year I forecast Savings to be highest at close to 40 per cent of our take-home household income! Without any shadow of doubt, it is due to Covid lockdown. All expenses have dropped in 2020, except for spend on kids, because my youngest started school this year. Property expenses also halved due to “mortgage payment freeze” for six months, this year. Savings could also be higher depending on whether I decide to spend on my house renovation this year. 


My wife and me worked hard to have a comfortable household income for our family. According to 2019 Singstat data (here), our gross household income for the past seven years are consistently in the top ten percentile and in the landed property range. 

Nonetheless, I was, and will never be complacent. I always remind my wife and myself that no jobs and salary are guaranteed, no matter how diligent we are. Just look at the Covid situation. Even the “iron gold rice bowl” of the Pilots are in doubt nowadays. 

As a result, I rarely overspent or even spent for myself, except for spending on my wife, family and kids, and for people who are generally good hearted, and/or in need. These are huge portions of our expenses, and including property expenses, account for half of our household income. 

Apparently I consider spending on kids as investments, as they will bear fruit in the future. Not just money, we also commit a lot of time with our children. 

My savings will often turn into investments, and ultimately with the money saved or earned, I intend to buy a freehold landed-house for my big household and finish paying within the next ten to fifteen years. 

In terms of charity, I will definitely love to do more, but our huge household and kids’ expenses can be a drag at times. On average, our Charity expenses is comparable to Vacation. This give an equal emphasis on Charity and helping others to just pampering ourselves. 

Saturday, 19 September 2020

Will I Become An Entrepreneur Or Encourages My Children To Be One in Singapore? (Part 2)

This is a follow up on Part 1. 

It is going to be a long post but, bear with me.  

Yes, I love to be entrepreneur, but risk and feasibility have to be assessed, especially in Singapore. 

You can call me “chicken” or one that talk big and no action but only write long posts in my blog or asked, "I am so good, why don’t I run as next MP?"  The truth is you don’t know me! Also, the quality to be an MP is more than just good. You need to be people’s person, compassionate, grounded with integrity, and popular, and above all, not afraid to speak the truth etc. Or simply join the right party or GRC to be a free-rider? 

No one should be reckless and just jump to become an entrepreneur, for the sake of becoming one. As a father and husband, I have immense responsibility towards my family. 

Anyway, the purpose of this blog is also not to please readers with sugar coated words or to boast how good I am or how big my portfolio is. Instead, with clear conscience and responsibility, this blog endeavours to relay the truth as much as possible, and for a large part of it, is based on real life experiences. I sincerely hope it benefits my readers including my own family members, who will remain genuine and humble to seek the truth to have the right mindset and integrity in life. 


I was a “tiny entrepreneur” in primary school, and started earning money by catching spiders at forestry areas near railway tracks, and selling the fighter spider at good profits. My top fighter “Blue Artillery Powder” cost S$8. Not too shabby back in the 80s! 

As a boy, I was competitive and mastered many skills. One skill is “Marble or GoLi” games, and I tend to bring back more coins with sand in my pocket than what I brought out, each day. The other skill is “Eraser Flipping” techniques and winning erasers to sell. 

While I loved collecting stickers, such as “Know Your School, Ghost Busters, World Cup” etc. but I can barely afford to buy many. Filling up sticker album was not my objective. Instead I accumulated stickers to selling classmates who are short of the specific sticker at a higher price! 

In my secondary school days, my sister worked in a popular Polo-T company “Burberry”. As staff, she can purchase apparels for up to 35-40% discount in the initially loose company policy. I will then show the catalogue to my wide network of friends, and sell the shirts at 15-20% discount to market pricing and yet, still earn the 15-25% margin. 



As a result of my business venture as a boy, and together with experiences of managing real business in my career, sometimes I do feel that I have the DNA and what it takes to build a business. 

Yet, I have to be realistic and the hard truth is that most start-ups fail. While we may have seen countless success stories in the news, they belong to the meagre minority. I have personally witnessed many friends who started on their own after 2005 with great vigour and enthusiasm. In the beginning, some even won awards, with stories covered in Newspapers. However, after several years or even a decade later, almost all ended up losing capital and precious time, that will otherwise be utilised more effectively. Most return to become employee with no aim of going back into business anymore. Thereby making their start-up experience of very little use. 


Singapore is for bigger companies to thrive, not SMEs!  
Please don’t misunderstand that I am afraid of failures and is negative towards entrepreneurialism in Singapore. The truth is we have to be practical and come to sense and ask, “if Singapore has an environment suited for start-up entrepreneurs to create a sustainable business without any forms of support?”  Or “if Singapore has an environment that is created to suit MNC or big establishments, rather than SMEs?  Isn’t it obvious that who is having the big pie of the lucrative businesses in Singapore? What is left for Singapore SMEs who are normally at the bottom of the supply chain competing with prices? Ok… I admit that this is not just in Singapore, but it is the general trend that the big and rich will become bigger and richer. 

Singapore is not strong in technology and innovation 
Today, Singapore economy is built on the basis of financial services and real estates. We are generally not strong in engineering and technology compare to smaller European countries such as Norway, Denmark, Finland, Sweden, Netherlands, Switzerland etc, or Korea and Taiwan who can produce exceptional electronics companies. 

Hence businesses here tend to be less niche and have thinner margins due to heightened competition. In those European countries mentioned, they have a lot of incentives for innovation, and often starts in University.  

No social benefits 
Also, many successful entrepreneurs are created in the aforesaid Europe countries when they get retrenched by their companies. This because they have good retrenchment benefits. On top of that, if they are not working, they received social benefits, and that is when they have the time and support for 1-2 years to innovate and be creative to build their first business venture. 

Support from Singapore is “one time”, often cheering success rather than focus on grooming 
The support needed for a sustainable and innovative company is not just “one-time capital rebate from government”. 

For example, I have a Singaporean friend who build his business based on technology for food supply here. He received CAPEX rebate from the Singapore government agency, as well as awards and news coverage from the media. After all the hype, the reality is the business is finding hard to sustain. This is because local companies big or small, will only buy base on pricing rather than his pitch for innovation, quality and freshness. On the contrary, those European countries I mentioned earlier, have stronger local content for sustainability i.e. local companies giving orders to local start-ups based on technology and innovation, despite the lack of track records and sometimes higher pricing. 

When Joseph Schooling reach the finals in Olympics, some of our leaders were so eager to take business class to fly to Rio to cheer him on. It is good that we are cheering for success, but for most times, we overlook that his family spend a million to groom him overseas, and the sacrifices and commitment made over the years. 

I am doing the same now with my own money, time and commitment for my kids in Sports. The relevant Singapore sports association is not only NOT helping but instead make it compulsory to pay monthly fees to join the association’s sub-par coaching, in order to qualify for selection for Junior Development Squad (JDS). 


Consider I don’t have rich parents, and after graduation, I have over 40K of student and expenses loan to repay all by myself. Next up is marriage, honeymoon holidays, house and car purchases, renovation costs etc burdening our shoulders. A typical Singaporean at the age of 30, will think he/she finally will start to have money, but they will actually be pretty broke!   

Housing and associated costs in Singapore undoubtedly are one of the most expensive in the world. Small HDB in Singapore cost more than 400KSGD, while Malaysia, SEA, Europe, US cost significantly cheaper with a bigger house. Above all, raising a child properly requires not just plenty of money, but a lot of time and commitment, in a highly competitive education environment. 

Cost of living in Singapore is way too high that you may not necessary fail in business start-up but, fail in the sustaining of livelihood. 

For example, I have many Chinese friends who own businesses in Malaysia. Fail start again, they said. Why is it possible? Entry employee salary is quite pathetic even if you work in a bigger organisation in Malaysia. To balance the lower salary, cost is extremely low if you are frugal. You have very little to lose comparatively transiting from employee to employer. Furthermore, rental of shop/office is also much cheaper than Singapore. Most employer in Singapore will struggle to pay rental of office spaces let alone sustaining the cost of their employees’ salary. 


Our government devised the seduction model so well that Singapore has so many foreign MNCs or locally owned Temasek MNCs that can pay rather high salary. 

This makes opportunity costs of being an entrepreneur even higher, if you are one of the high paying employees. 

Why should I be an entrepreneur in Singapore when I know the outcome is that SMEs will forever be vendors in the low-low supply chain, at the mercy of big foreign MNCs or Temasek Owned or stat-board organisations. Then, being squeezed dry with low margin, and in time of crisis, faced high possibility of bankruptcy. 

In addition, if Temasek-owned companies also find it hard to have a global footprint with their prowess and mighty support, what makes me think that you can an entrepreneur in Singapore by your own effort, thinking that you can be successful to build an international company. There are successes, but low percentage! 


In my opinion, there are comparatively bigger successes found in Singaporean entrepreneurs who started from working in MNCs or overseas and finding support from powerful businessmen, rather than those entrepreneurs who started locally after graduation or merely with a few years of work experiences, with small network. 

For e.g. John Lim, founder of ARA left his MNC salaried job at the age of 45, invested S$700k of his own money while Hong Kong property conglomerate Li Ka-Shing-backed Cheung Kong Holdings pour in $300k to start ARA in 2002. Later Lim also obtain the support of Chew family of Straits Trading. 

Dymon Asia founders Danny Yong and Keith Tan worked as fund managers in MNC with overseas experience prior to the support of US billionaire Paul Tudor Jones, who poured US$100 million seed funding just before the GFC. 

Espressif Teo Swee Ann worked for MNC overseas in US/China before establishing his company in China and thrive there instead of Singapore. Not sure if he has any support? 

Not negating his ability, Grab Anthony Tan also have super-rich and powerful parents to start with, before finding Grab. In any case, Grab has been making huge losses since inception, but the garnered support from Soft Bank and DiDi Chuxing

In today business environment where customers have more choices and are more demanding, aside your entrepreneurial ability, you also need to have “Gui Ren – lucky star”, i.e extremely lucky to meet someone in your career who is powerful enough to support you. Otherwise you need to have a rich parents to help you in your family expenses, and then hope that, way before the business can become sustainable, you can receive a huge injection of seed funds with complementary high Salary. 


I am in my 40s now with a big family to feed. To be an entrepreneur without too much worry on daily expenses, I can sell one of my properties and stay in a smaller one, cashing out quite a huge sum. Together with my decent-sized investment portfolio and a working wife, I should be in a financial comforting zone to start a business. 

That said, all my children are still schooling, and with a relatively good paying job, what is my incentive to become an entrepreneur using my own money and network? 

Is the risk taking in a pretty adverse entrepreneurial environment like Singapore, worth the try?  And will the local-squeeze-local culture going to frustrate me as an entrepreneur more? The bad low paying ability and relatively bad paymaster of ASEAN countries are not going to help as well? 
HOWEVER, If I were to meet an established businessman who trust in me and see the potential of my experiences and capability to partner me to start-up in Singapore, it will be a different story. We can be founders together, leveraging on each other’s strengths. To be honest, I did receive similar request, but the timing to execute is also important. Keep striving and dream goes on…  
Typically, I feel that this way of entrepreneurialism in Singapore is easier to produce start-up that will be comparatively more successful and sustainable. 

Last but not least, I will definitely encourage my children to be entrepreneurs, if I can continue to be financially sound when they grow up. In this way, even if my own entrepreneurial dream fails to take off, I can put piggy bag on them. Nevertheless, I will not give them stress and let them follow their true passion. 

The day when they are ready to enter the working society, I will encourage them to have work experiences in small SME and global MNC first, rising to at least a managerial post, or at least knowing what business is like, before transiting to find their own business with my support. 

And perhaps, not in Singapore, but in China or Vietnam!

Thursday, 17 September 2020

Singaporeans Don’t Lack Entrepreneurial Spirit and Capability? (Part 1)

Earlier, I highlighted the flaws of seduction model and the need of penetration model. Many may feel that the fundamental problems why Singapore are unable to build companies to “penetrate” into international is due to Singaporeans’ lack of entrepreneurial spirit and/or the way our education system is structured to be lack of creativity. 

In my opinion these two reasons can be contributing factors, but Certainly NOT the root cause!  

Before I delve into what I think are root causes of Singapore’s maladroitness towards “Penetration Model”, let me first share my personal encounters with many entrepreneurs. The personal experiences can give me a better understanding to determine the root causes. 

Finally, I hope these personal experiences can help me or my children in my/our own journey to transit from employee to employer in the near future. 


My BIL and sister founded their businesses in the mid 90s. As a teenager student, I will work part-time in their company, and learn a lot about businesses. They have two businesses in complete separate fields total 150-200 employees. Maybe lesser this year! The first business was market leader in Singapore for close to two decades. Today, they are still running both businesses successfully amid in a very difficult business environment. 

No lack of entrepreneurial spirit
My BIL is very entrepreneurial, have a glib tongue, good in sales and have so many ideas for growth. He is willing to take risks and love to make decisions. He will take action before you know it. He had tried so many businesses before, including selling “90s TV sell-a-vision products”, push-carts, door-to-door-sales etc. He failed for one decade and get up again before finding his truly first venture in the mid 90s. My sister has finance background, and is the brain and the operational hands across the entire spectrum of the businesses, giving the stability and sustainability. For more than 25 years, they work extremely hard, and are always very hungry and driven, to the point that they may even neglect their family.   

The business struggles 
Their first core business has been thriving until recent years. That business lacks technology and is not niche! Margins became very thin with influx of so many competitors. Many ex-staffs learn the trade and started as competitors. Furthermore, demand softens in Singapore as years go by, and overseas protectionism meant it is extremely difficult to thrive there as well. 

The other business is in financial and consultancy. It lacks technology and provides mainly services and training. The competition is lower, but it is very difficult to convince customers to sign up orders. In general, they tend to have more overseas clients but lesser Singaporeans one. I was told that local ones tend to be more sceptical and price conscious compared to their overseas clients who are mainly from China and Malaysia. Their overseas clients also value relationships more than local ones, that I feel they sometimes sign up orders, due to friendships and out of pity, seeing the hard work and sincerity of my sister and BIL. 

Both businesses lack of technology and nicheness. Hence, aggressive sales and low pricing are needed. Whoever have better sales persons and network, work harder and able to keep price low will win the orders. 

Why able to sustain for more than 20 years? 
Aside from hard work and passionate commitments and other attributes needed in business, below are some key external factors that CERTAINLY HELP A LOT in their business success and sustainability. 

First, they started early in mid 1990s.  Back then, competition is not that intense and customer loyalty is also stronger. With a bit more of creativity and good service in business, you are able to satisfy your clients. Customers also tend not to go shop around for many vendors. Yes, no internet yet! Relationships meant more than money at times. 

Secondly, cost of living is low facilitating their start-up. Their 4-room HDB at prime location is only less than 150K. They sold for more than 400K five years later. While they were very poor, but cost of living is also low, allowing my BIL to fail so many times for close to a decade, before finding his first pot of gold. My sister is an employee initially, supporting my brother in all household and daily expenses, and even giving him pocket money. Until their business started to earn money, then she joined him. 

The third reason is the riding of the boom from 2000 to 2008 (except for brief period of SARs), where they accumulated good earnings in their business. During this golden period, you need not to be very smart to earn good money! 

Lastly, my sister always said properties are their best earning and not business itself. The buy/sell of properties including landed ones, really earn them quite a fair bit of money.


I have worked in local SMEs/listed entities ranging from 5-10 to 150-200, 400-500 pax. The direct day-to-day dealings with the founders of these companies, taught me a lot of things and I get to know their entrepreneurship struggle as well as recipe for successes! Likewise, I had many dealings with clients, suppliers who are owners of companies. My decade-long MNC experiences with frequent travelling also allow me to come into contact with many overseas entrepreneurs. 

No lack of entrepreneurial spirit
Again, there is no lacking of hardwork, commitment and entrepreneurial spirits from Singaporeans. I have witnessed many grew their business into the international arena with creativity and drive. One of my ex-bosses grew his business from zero up to 400-500 employees, and having offices/factories in SEA, China, Middle East and India. We also had many globally renowned clients. 

The business struggles 
Yet, despite the “on paper” brisk business, my ex-boss of engineering and manufacturing firm told me that he struggled for 30 years to make money. While in business, money earned was reinvested each time, and he almost go bankrupt three times. Although people thought he is extremely rich, his house and car were still on instalments back then. 

High costs of business and intense competitions, and learning from projects to projects, are main reasons of the struggle. Many of his ex-employees also become our competitors, competiting mainly with price. Clients also have more choices and often “squeeze” to the maximum. Many times, we accept orders that eventually lost money. 

Fortunately, my ex-boss sold his business before the GFC and cash-out. If not, the GFC may have bankrupt his business. Even if he may survive the GFC, the Oil crisis in 2015 is likely to ruin him. I had known too many businesses collapse even after 2-3 decades. Specifically, I have one close friend and vendor who was in business since 80s and use to be the big boss, but loses everything including his properties that was collateralised to inject cash into the business for survival. Swiber, Ezra, Swissco and many others, who used to be darlings in the industry all went down. Likewise, in other industry, you also see big names like Hyflux, recently Hin Leong going down. 


I have also many friends/relatives who started their own businesses in various industries, ranging from Tech & IT, Retail, F&B, Marine & Offshore etc. Here, I am referring to those without parents’ support, and depend solely on their own. Some started after graduation with funding support and others get working experiences before building their businesses. 

I realised that those who started earlier before 2005 tends to be able to sustain longer their businesses. Many who started after 2005 struggle to make their means. It may look good initially that wow “I finally become the boss of my own business”, but for many, it only looks good for a while, before they returned to become employees. In the process, many also lost their savings that was ploughed into the businesses. There are very few who are successful having started their ventures after 2005. 


So…is it really true that we lack entrepreneur spirit? Or our education only teaches us to be obedient? Or Sim WL’s No U-turn philosophy is embedded in us, Singaporeans? 

In general, I also do not think that we lack entrepreneurial spirits, comparing to overseas Entrepreneurs who are successful. I have met many foreign smaller sized entrepreneurs who have do very well in their own countries but cannot do well in Singapore due to the high cost and over-competitive nature here. 

Overseas Entrepreneurs have lot of support from their government for local-for-local. For instance, in UK, Norway and many European countries, they have Export-Credit financing support for any export to overseas clients. Most important of all, it is easier for them to be profitable within their own countries before they venture outside due to local protectionism. 

In Singapore, it is too tough a business environment within our country. Local-squeeze-local rather than local-for-local. Hence, if our base core business in Singapore is not strong, venturing outside becomes tougher. 

But one thing I am sure is all work extremely hard and have full commitment in their businesses. In fact, those Singaporean entrepreneurs I know, tend to work harder and longer hours than their Malaysia, rest of South East Asia, European etc counterparts. Kudos to all Singaporeans! 

Our education may not focus on entrepreneurialism like the USA, but overseas education system in Malaysia, China or even some in Europe are also sub-par or comparable to ours. But why it seems like they have more successful entrepreneurs than us. In my article earlier, I also mentioned successful companies build by Singaporeans such as Dymon Asia, Razor, Espressif have founders graduating from local universities.  

I personally don’t think the founders of these companies lack entrepreneurial spirit or capability. They are neither inferior in ability compared to overseas Entrepreneurs. The environment of Singapore is definitely tougher than overseas. Overseas business environment either have bigger market, or tend to support local for local in spite of price, while I reckon the Singapore business environment is over-pragmatic in general. Furthermore, cost of living is simply too high here. The opportunity cost of leaving a high-paying job in MNC, locally owned Temasek big companies or Statutory board, without parental support or backup money and with a family to feed, is giving sensible people two cents worth of more thoughts! 

To be continued…. Part 2 : Will I become an Entrepreneur myself or encourage my kids to become one? 

Sunday, 13 September 2020

Is Singapore Economy In Danger for Long Term Decline (Part 2)? - The Need for "Penetration Model"

This post (Part 2) continues from the previous post. Is Singapore Economy In Danger for Long Term Decline (Part 1)? - The Flaws of "Seduction Model"


In the Financial blogosphere space, many aspire to achieve Financial Independence Retire Early (FIRE). We do not want to depend on our day job indefinitely, running an endless rat race. In a way, we want to have control over our own life, and do not want to depend solely on our salary for survival. Hence, the strive for FIRE, regardless of where or how they started.




In spite of all attempts to be independent for ourselves, I realise a contradictory phenomenon when we are discussing similar issue for our country.


We disbelieve that Singapore can create a “world beating MNC”, because we are not in a favourable position. We think that the odds of happening are very low.”


Isn’t it funny, when it comes to issues for ourselves, we do not want to depend on others for survival? We do all we can to achieve FIRE and nothing is “gonna stop us”. The strong faith to achieve Financial Independent (FI) even motivate many to quit their stable job to own businesses teaching FI, and others become FT traders, and some living on dividends to cover their expenses. But when it comes to issues for our nation or our next generation, how many times have we heard that “we have no choice because we are small with limited resources, and we have to depend on others for our survival.”  


Isn’t it funny, that suddenly we seem to forget that five decades ago, we were at “ground zero” with no money, no resources, no infrastructure, no talents, but a divisive multi-racial population? Are the odds of our success higher back then? Certainty NOT! Yet, we made it!


But now, just to create a world beating MNC with Singapore current status of money, expertise, education, good infrastructure, good location, bilingual population, we said “the odds of happening are very low.”


The truth is, it has nothing to do with “odds” of success! It has everything to do with the mindset to begin with!




Stop building barriers for ourselves, before we build anything

In the following, we will take a look at examples of small countries producing global companies. Before we start, please have an open and positive mindset, rather than lamenting:


“aiyah…their countries or companies have a long history, aiyah.. they have how many millions population bigger than us, they have bigger land… bla bla bla.”  


Sadly, this can be the mindset, that before we start building anything, we always start to build barriers and find excuses. And the worst, is to find tonnes of reasons to justify why we can’t, and why we are already very good now and should not change. When we should, instead appreciate the truth and facts, and have a humble and positive learning attitude to change and to improve. And there is absolutely no shame when you are wrong or have failed. At least you try!


Small nations producing global names and footprints

Below are some examples of small countries with companies/brands that thrive in the international arena. Many countries mentioned, I have either been there before, or have close business/personal relationships and friends with the citizens of these countries. Hence, I am speaking from personal experiences and not just “google and read from internet”.


Finland, a country with 5.2M population, not strategically located and with a very harsh cold climate, can produce companies such as Nokia, Kone, Neste, Wartsila, Cargotec etc with global footprints.


Denmark, another small country with 5.8M population, producing names like AP-Moeller-Maersk, Carlsberg, Orsted, Novo Nordisk etc. Moreover, Denmark has always been engaged in scientific and technological invention, from the very start and has not stay stagnant. In recent times, the country also participates in many high-profile international science and tech projects.


Switzerland, with names like Novartis, Nestle’, Roche, ABB, Tetra Pak, Glencore, Rolex, Swatch, and International banks in UBS, Credit Suisse etc


Sweden, producing Volvo, Ericsson, H&M, Nordea, SEB, Swedbanks etc.


Netherlands, a country that is dangerously below water-line, has global names like Unilever, Heineken, Shell, Philip, ASML, Randstad, ING, ABN etc.


Norway, aside from its oil reserves, the success of the country is also as a result of ingenious engineering and exceptional creativity in Technology with many entrepreneur-led SMEs thriving with global presence.  


Israel, a country with limited natural resources, surrounded by hostile countries, but has intensive development in science and technology, military weapons, and also development of the agriculture and industrial sectors over few decades to make the nation largely self-sufficient in food production! Israel also has the second-largest number of startup companies in the world after the US, and the third-largest number of NASDAQ-listed companies after the US and China. For example, WAZE, the navigation App was an Israeli start up acquired by Google in 2013.


The above are just some of the many examples of companies that have global footprints. Of course, some may want to compare Singapore to SEA nations that we are doing extremely well. But I prefer that we learn from countries who have strengths that is better than us. I am not advocating comparison, I advocates learning. I have many friends from most of these countries and their camaraderie spirit and love for the country is something we really should know. These countries are small, yet creative with high proportion of local people for PMETs. They focus extensively on “true” R&D to build technology and products of their own that can penetrate and cater to the world. Investing locally for long term and sustainability is really their strengths. On top of that, they have free education and healthcare and a very good work-life balance. Yet, they never falter at the global stage.


Large countries with little progress

Still not convince… and you still think that country and population size always matter? How about Brazil and most South American nations, India, Indonesia etc. Are they not big enough? Why are they still struggling as developing nations? Are you able to name some of their famous companies and brands with global footprints? Perhaps not too many!


It is the mindset, the attitude, and the character that matters

Yes, US and China are big countries. However, the fundamental reason for their successes today, is not just size alone. It is the drive, the hunger, the hardwork, the creativity, the freedom, the competition, the ambition etc of the people that have propelled them forward. Above all, it is the NO FEAR for failures that give them the extra edge!


Sometimes the lesser you have, the more you gain! In many instances, people or countries tend to excel in adversity! Therefore, stop bemoan that we are a little red dot with limited resources and have very little choice.




Don’t get me wrong. I never say we can survive on local consumption and a 100 percent local workforce. Common sense will tell us it is impossible for the country of our size to survive on local consumption. The world today is interconnected and complexly intertwined. No country can solely depend on oneself, even for the likes of US or China.


As I repeat again from Part 1, making Singapore attractive for foreign investments is of paramount importance. And for all we know, we already did very well in the seduction model, and I commend Singapore for that.


The headline from the Straits Times newspaper on Saturday 12 Sep 2020, reads “Singapore continues to draw investments from global players” – TikTok parent ByteDance, German logistics firm DB Schenker, PayPal investing more here.


So then, what’s my point.


My point is: while we continue to make Singapore a country that is “seductive” enough for foreign investments, we should then learn from them, and also effectively develop our own local homegrown talents, companies and brands, so that in the long run, we can truly “penetrate” out of Singapore with success and sustainability.  Today, US is still the super power because of the huge number of home-grown corporate powerhouse, not because of their government! Likewise, China is catching up like grease lightning.


Therefore, I term “Penetration Model” as the building or grooming of fundamentally strong Singaporean companies or companies that are built by Singaporeans. This is so that these companies are able to extend their businesses into a regional or global environment, thriving in the midst of global competitors to become true global MNCs with Singaporean HQ and core, that is sustainable and growing to become market leaders in the world.




Grab is not global yet, but did well in SEA growing to 6,000 employees since founded by Anthony Tan and Tan Hooi Ling in 2012. Although the founders are bornt in Malaysia and the company started in Malaysia as MyTeksi, it is in Singapore, where the company grown. The backing of Softbanks, Didi Chuxing, and the lack of support from the Malaysia government certainty help the growth of the company in Singapore. Anyway, Forbes still list Anthony Tan as Malaysian although he has already obtained Singapore citizenship. Both Tans being educated in Harvard also provided them a somewhat different mindset. The male Tan coming from a rich family background has added advantage too.


Then we have Razor, the gaming company founded in US, by Singaporean Tan Min-Liang, an ex-lawyer educated in NUS. I am not a fan of Razor and the founder, but have to give absolute credit to him for the ability to be successful in the competition of many US companies. That said, there is not much to boast if you look at Razor Inc’s share price performance since its listing in HK.


Espressif, the fabless semicon company founded by Singaporean Teo Swee Ann in 2008, has been in the limelight lately. The company is located, grown and listed in China. Teo graduated from NUS as an Electrical Engineer, and went on to work as an Engineer in US, before joining a Chinese company working in China. Teo has hoped to hire 80 Singaporean Engineers over the next two years in his R&D centre in Singapore.


Finally, Dymon Asia, the investment firm founded by Singapore hedge fund manager Danny Yong and his good friend Keith Tan in 2008, has also find success within a short space of time. Both founders graduated from NTU, and I love their humbleness and down to earth attitudes. Yong used to work for JPM, Goldman Sachs, and had spent six years’ experience working in HK and Tokyo offices. Tan used to work for Standard Chartered and has experience working in Shanghai.


All have overseas experiences

With the aforesaid examples, it is clear that all the founders have extensive overseas exposures. To be honest, Grab is still a very local company finding success only within SEA. Aside from Grab’s founders, all founders had career experiences where they start and compete, grow and thrive in a foreign competitive global environment. Some also have worked for foreign leading MNCs before finding their successes. And all are graduates from local universities (NTU/NUS), aside from Grab’s founders graduated from Harvard.



On the contrary to above examples, most local Singapore leaders often start with exceptionally good academics, received scholarships to study in overseas Universities, graduated and come back to Singapore with a career in local statutory board, SAF, or Temasek-owned companies with a pathed career destined to bring them to the very top, unless they foil it with acts of stupidity.


During my reservist ICT, I was told that a young overseas scholar who just graduated not too long ago, was posted to our unit as Captain, destined to be a General in no time. Everyone is aware of that. The Captain then made the stupidest presentation in front of all the officers. Despite that, none of the Majors and Colonels dare to give him real feedback about his ignorance and impracticality. Yet he was greeted with compliments even by his superiors… “yes, yes, yes” and “good, good, good” …, for the fear that very soon in the near future this young Captain will become their General and Commanding officer and take revenge on them.


Outcome: The confidence of the young Captain rose and soon became arrogance, intensified with ignorance and total detachment from the ground and reality. He will then go on to become SAF General, and later even as Minister.


This type of leader has very little local competition in his/her career to speak of… no failures, no correction, no real progress, let alone thrive in an international competitive global arena. When he/she travels overseas, he/she is always supported by many subordinates or “ka gias”. All he/she needs to do is to greet, smile, shake hands, and exchange dialogue with a plan script. And if he/she meets with anything too difficult, many of the “ka gias” will quickly flock to his/her rescue!


It is like a frog who is the king in his well, that jumps out of the well occasionally and thinks that he knows what the world truly is like!




The Taiwanese Driver

Many years back, when I was in a Taiwan, I had a designated Taiwanese driver for a few days. The driver Mr. Hu, in his 50s, seemed extremely knowledgeable about the world and read a lot. He is very insistent in his views on many important global matters. As the days passed with plenty of conversations, I realised that his views are mostly superficial or merely extracted from what he read on the newspaper, and lack solid insight. Furthermore, he never once substantiates his views with real personal experiences/testimonies. Then I asked if he had travelled to many countries? He replied that he had never taken a plane in his entire life before and has never step out of Taiwan! Duh!!!


My Ex-boss’s advice

When I was a young engineer, I worked in a small SME. Beside computer modelling analysis or layman calculations, and writing reports in office, I often had to travel abroad. My overseas work normally involved hands-on work in very harsh environments. I also gave training and presentation to overseas clients frequently. I started to get sick of the frequent travelling. My boss, a local Singaporean who is one of the owners and founders, told me something I remember so vividly. He said “go out and experience the world, there are mountains to climb and rivers to walk. Don’t just stay in office and read!” This ex-boss has since been semi-retired in his 40s and migrated to Australia. The Chinese has a saying 读万卷书,不如行万里路!




Guess I have said enough and you probably already get my point!


With the money Singapore earned, and the knowledge gained with a globalised economy, we should have strived to build more home-grown SMEs to grow our footprint overseas as early as in the 1990s. Instead, we are always more concern about every year economic success percentage, and neglect to invest on our own talents for long term future. We keep on justify our old methods with barriers and excuses.


It is always “our yearly report card score” that matters, but the long-term importance of the learning itself matters less. This mindset is so wrong!


While it is late now, but it is better late than never. I really hope that one day we can wake up from our clouded vision and improve our effort to groom home-grown talents to build international companies. And yes, stop saying that the odds of happening is slim!


Friday, 11 September 2020

Is Singapore Economy In Danger for Long Term Decline (Part 1)? - The Flaws of "Seduction Model"

More than fifty years ago, Singapore has no money, no talents, no technical expertise, but only low-cost labour who are willing to work extremely hard and humble ourselves to learn fast from foreigners who unselfishly imparted their knowledge to us. Back then, Singapore is a blank piece of paper. LKY and his team did an absolutely amazing job in attracting foreign investments, utilising his charisma to build friendships with foreign nations, who help this “little red dot” to become where we are today. As a nation, we are politically stable with friendly foreign policies. Banks grown rapidly and our manufacturing expertise improves by leaps and bound. Together with our good port location and the unique West-East culture, trading flourishes.


The above economic model of making Singapore attractive to foreign investments is what I termed as the “Seduction Model”. Today, we are still deploying and advocating this model. In parallel to this model, we have also established Temasek Holdings to invest in companies globally. At the same time, many state-driven enterprises gradually become portfolio of Temasek and were public listed and had evolved over the years.




Recently, Alvin of Dr Wealth exchange some message with me describing his views on the seduction model. The message:


“The Government, with its monopoly on talent, has figured things out ahead of us. We are not in a favourable position to create a world beating MNC. The odds of that happening are very low. The next best thing we can do is to attract foreign MNCs so that we can tax them. We have to be prudent with our expenses and invest our large foreign reserves to bolster our financial future. We need to operate as one Singapore Inc.


Singapore’s superpower is closely linked to our financial and economic status. We have no resources; we only have money. We cannot lose this power. The only way to preserve this and to ensure our survival is for our government to plan, execute and function as one Singapore Inc.


Hence, Singapore just needs to attract Google, Facebook, Amazon, Apple and the likes to set up shop here. But we need to provide the infrastructure (Smart Nation), talent pool (re-skill workforce if we need to) and political stability, else they won’t come. With their presence, our Small Medium Enterprises (SMEs) can become vendors to these MNCs, earning good profits for our towkays and provide employment to Singaporeans.”  


Rolf’s thoughts:

As usual, I will speak my mind from my heart rather to be politically correct. That said, it is just my two cents thoughts. I hope readers are not perturbed by my pretty direct comments, whether or not you agrees with me. *Smiles*. Nonetheless, I welcome disagreement and constructive and fair reasoning!


The seduction model is still of paramount importance today. However, this sole successful model for us, has many flaws as we progress economically.  Let me explain as follows.




The seduction model worked extremely well when we first started to build a nation. Nonetheless, as Singapore emerged from a third world country to a first world country, we are experiencing the diminishing marginal returns of the model. This is the direct result from increasing cost, ageing population, changing of mindset etc.


Instead we should, in parallel, build on the “Penetration Model” if we still want to remain where we are, over the long term. I will explain this model in Part 2.


Always dependent on others

While it is extremely important to continue to attract foreign investments, the over reliant on this model, means the “forever” dependent on others, and the lack of emphasis to develop our companies and brands. Singapore has limited home-gowned companies that can induce regional or global presence, where we can tax from or gain export revenue. In circumstances like this, if foreign MNCs start to pull out their investments, or relocate their HQs elsewhere, we will suffer serious economic consequences. Yes, we have strong reserves, but we cannot expect them to last forever!  


MNCs relocating Asia Pacific HQs

Personally, I have experienced and see the increase of global MNCs relocating their Asia Pacific HQ from Singapore to Shanghai or Hong Kong or even Kuala Lumpur in the last decade or so. The relocation to Shanghai or Hong Kong is a no brainer due to the proximity to the growing and huge market of China. The dynamism of China greatly over-shadows us. It may seem apparent because of the sheer size of China, however it is not true. The main driving factor is the hunger, the competitiveness, and the eagerness of Chinese to learn and to improve! Brazil and India are also big countries, but look at their progress!  


High cost in Singapore

Then, there is relocation to Kuala Lumpur due to the escalated cost of living in Singapore. For countless times in my work, I have heard foreigners said “Singapore is just too expensive”. Yes, Singapore may have increased efficiency compared to Malaysia, but in times of crisis or when business is not doing well, cost control is first priority. In any case, our high costs in almost everything is also depriving the success of entrepreneurs here. In my opinion, there are so many more successful SME entrepreneurs in Malaysia than Singapore, as the low cost environment gave the entrepreneurs a better chance of success or at least an easier option to bounce back up!



In times of crisis, foreign countries may want to protect the businesses of their own countries and may shrink investment outside their home countries. Then foreign direct investments will be reduced potentially leading to the shutting down of operations here. This is happening now, as many MNCs are cutting headcount in Singapore rather than their own countries for the sake of protecting the jobs of their own people!


SEA Market is still developing

Despite many MNCs relocating their main focus to China, Singapore will continue to be the ideal location as HQ for South East Asian Market (SEA). That being said, the market within SEA is still way too small and still have a long way to go, except potentially Vietnam. ASEAN companies are also too price conscious at the expense quality, and are also comparatively poorer paymasters, making business in the SEA region very difficult and not profitable. Again, this is stated from my personal experience and concur by many that I have known.


Impossible to re-skill workers within a short time

Due to our over reliance on foreign investment, we will always have to adapt very quickly to the demands of foreign investments. Otherwise, they will head elsewhere. Hence, we will always have to re-skill our workforce very quickly or even abruptly to cater to the world of change. However, it is not as easy to re-skill effectively within a short space of time, for employees who had spent decades of their career in an Industry, and now wanting them to abruptly change their skill-set. Our aging workforce makes matter worse. 


Kowtowing others and step on our own kind

The seduction model essentially means we have to be very accommodating to foreign nations or foreigners. We have little control over our own fate. Singaporeans are known as one of the most accommodating towards foreigners. However, overdoing it, may also explain why we tend to “belittle and squeeze” on our fellow countrymen and kowtowing to foreigners! I think the correct approach is to be truthful and reasonable and it is not necessary to be overly accommodating, in order to build a strong and sustainable relationships with others/foreigners. I have sufficient foreign friends to justify this point. 


This negative trait is something I never seen in other countries, where they always protect their own people, their own companies and their own countries! There is a lack of camaraderie spirit in Singapore. Selfishness and short term self-gain is more prevalent than the bigger love for the country. The concern upon the long term future of our younger generation is clearly missing by the majority. 

For e.g. When I was a supplier with local SME, local big Singaporean clients will tend to “threaten and squeeze to the max on local SME suppliers with unreasonable terms!”. But when I am in western MNC, especially when I am with my “Ang Moh” colleagues negotiating, the treatment and the tone of the same local customer will somehow become more subtle and negotiation becomes more reasonable.


A friend working as a consultant just told me that a typical project, where Stat-board company squeezing Temasek-owned company dry and no margin left in the project with unreasonable request.


Who say local SME vendors have good profits?

Alvin mentioned, that with MNCs in Singapore, then our SMEs can become vendors earning good profits and provides employment for Singaporeans.


This is not necessarily true from my personal experiences. The lower the supply chain which is where the local SMEs are, the lower the profit. In business, when you are at the mercy of others, with so many competitors, your margin is normally thin or frequent times even making imminent losses when you underestimate the cost! Furthermore, we also know that most of the good local businesses are assume by Temasek owned companies or foreign MNCs here.


The poor man’s mindset of forever being a vendor!

Singapore companies should not be “forever” only wanting to be a vendor. This mindset is very locally bound, safe, and government sheltered mindset with limited international competitive experiences/exposures, which explains why Singaporeans are unable to progress out of Singapore or SEA or thrive in a developed-country-foreigners' dominated environment. 


Why can’t we also be the customer in other countries?


I know that there are many smaller sized countries who manage to product big foreign MNCs achieve this! These companies are higher in the supply chain here, and Singaporean Vendors have to be at the mercy of them. For e.g. Neste Oil and Gas of Finland is building a mega plant in Singapore. Orsted of Denmark is investing heavily in Taiwan. There are more examples. 




Let’s assume our local SMEs are making profits. Then where is our local bred companies/brands with international footprint?


We love selling away our good companies

We used to have “Tiger Beer” as an internationally known product. Tiger beer was later sold to Heineken, for some reason I do not know. Heineken was originated from a relatively small country, Netherlands. Likewise, Carlsberg from Denmark, a country with same population as Singapore. I have this feeling that Singaporean entrepreneurs love to cash out once their companies have grown to a certain level. On the contrary, in US, Europe, China or even Malaysia, they have the belief to keep on growing or at least pass it on to their next generation.


Stop using Military leaders as Political leaders or CEOs

Then we had NOL, but it later become a laughing stock with growing losses! Yet, former Chief Defence Force Ng Yat Chung who ran NOL, continue to be granted as CEO of SPH after his failed expedition in NOL. I have nothing against people with military background. One of my very good friends are from the Airforce in the first part of his career and goes on to be very successful in the private sector. For military leaders who spent most of their career in SAF until they become colonels or generals, let us ask ourselves if they are truly suitable to be business or political leaders? How many success stories are there in history? Yet, we continue to think that military leaders are the best option for our country! 


Mediocre Global Brands

Perhaps we consider brands such as Razer, TWG, OSIM, Rauol, Crystal Jade, Charles and Keith global brands? My foreign friends do not know these names. Instead, they heard of Nokia, Ericsson, Shell, Unilever, Nestle, Roche etc


The One-time success story only!

Creative Technology’s sound blasters once upon a time, manage to achieve global status. Soon after the “one-time success”, it died out and went on a decline. Hopefully we do not see similarity in our Olympiad Gold Medallist Joseph Schooling, although it is becoming very much the same. 


Fortune 500 Singapore companies

How about our home-grown companies with global footprint or being international recognised or in Fortune 500? After a search, I found no home-grown companies except for Wilmar.


Only good in our own country!

DBS, OUB, OCBC…. Yes, three very stable and well-rated banks, but how about their global footprints? Singtel, Comfort Delgro, ST Engineering, Keppel, Sembcorp etc expanded overseas, but how successful are they? Singtel acquired businesses in India and Australia, but are these businesses in foreign land successful? Please go and check out Singtel performance in India for answers. Comfort Delgro, ST Engineering and many other Government/Temasek-supported companies are in my opinion just mediocre when it comes to overseas performance. Even our stronghold REITS mainly only performed well within Singapore or Australia, outside which, performance are average in general.




To conclude at this juncture, Singapore is fabulous when it comes to making Singapore good locally. But once we venture outside Singapore with foreign competitions, we always become mediocre.


Do not get me wrong. I am not being the condemner for the country I live and love. In reality, it is because I love this country, that is why I am voicing out. Hoping that we can improve and is able to the truth and  to change our “Mindset”.  


In my lifetime, I very much think that I will not be affected much even if we are heading for an economic decline. My children’s generation will!


In Part 2, I will detail why being a small country with limited resources is not necessary a disadvantage. And there are many examples of smaller countries utilizing the “Penetration Model” with companies and brands thriving in the International arena.


Further to that, I will explain why Singapore is unable to produce local talents that can compete in the international arena. Again, it has nothing to do with our small population, but rather our “flawed and narrow mindset” as a result of lack of International competitive exposure, including most of our leaders. Yet, we are not humble enough and always think that we good!


The reality is… we were good!


This also explains why many talented Singaporeans who can excel in a competitive foreign environment within develop countries, have chosen to leave the country.


To be continued….