Public reactions in Singapore to Temasek’s purchase of Shin Corp has so far been muted.
Except for comments on the commercial aspects of the deal, no one has really ventured into the ramifications of the Shin Corp deal on bilateral relations. However, the increasingly shrill opposition to Thaksin and the ammunition that this deal has created in the Thai political scene looks set to backfire on Singapore. Two commentaries in the Thai newspapers seem to point towards that.
In The Nation’s “Far-reaching fallout of Shin-Temasek deal in the region”, Mr Kavi Chongkittavorn bluntly noted that “no matter how one looks at it, the mega-deal between Shin Corp and Temasak Holdings has made Singapore look bad”. Thais have accused Singapore of “buying over” Thailand because the sale involved government concessions, including telecommunication wavebands, satellite parking and air traffic rights and iTV. Thai Prime Minister Thaksin Shinawatra has, however, praised the Singapore counterpart in taking up the deal as “an act of real courage”.
It has evoked so much opposition that for the first time, a number of press outlets have detailed the meteoric increase in Singaporean investment in Thailand since the 1997 economic crisis. Most reports were suspicious of Singapore’s intentions, saying the deal could endanger the country’s security and strategic interests. This marks a turnaround from the previous strong ties between the two countries, especially since Singapore’s prompt and efficient emergency assistance to tsunami victims in southern Thailand won the admiration of the Thais.
The Nation’s commentary opined that “from now on, Singapore’s image in this country will be closely linked to this notorious deal and it may hamper future good relations and investment with Thailand. At the anti-Thaksin rally Saturday, anti-Singapore banners were visible. The fact that Temasak was willing to undertake such complex negotiations and financial transactions reflects the island’s “win-win” business instincts and its perception of Thaksin and his government”.
In another commentary in The Bangkok Post, Dr Thitinan from Chulalongkorn University noted that though in theory, Temasek’s acquisition of Shin Corp is no different from any other expanding international investments in an era of globalization, the reality is different. “What is most problematic in the Temasek-Shin Corp deal is a foreign government-owned company buying up assets, deemed as tainted by the Thai public …” He warned that Temasek having acquired such tainted assets, “may soon face a host of murky issues”.
It is uncertain if Singapore realized the potential rancour that would arise from this venture. The Nation’s commentary went on to warn that the deal will impact “on the future of ASEAN’s economic integration. Given the high level of cooperation between the two countries, Singapore and Thailand have already moved towards closer economic cooperation within ASEAN, aspiring towards the earliest realisation of the ASEAN Free Trade Area. With Thaksin’s leadership under siege as his ministers resign and talks of impeachment snowball, this unity of vision could suffer. Other ASEAN members may find these arrangements threatening to their sovereignty. It could also “ignite anti-Singapore sentiment in other ASEAN countries”, affecting Singapore’s “long term policy of regionalization” in the region.
The Nation’s commentary ended with the reminder that the Shin-Temasek deal is “a rude wake-up call for Singapore” of the unpredictable political dimension to every business transaction. It warned that the island’s decision makers “have to be more sensitive and mindful of non-Singapore mindsets and scheme of things” and that “the political fallout will be long-lasting and costly”.
As the political temperatures continue to rise in Thailand, Bangkok Post’s commentary call on Temasek and the Singapore government to “address those controversies by clarifying their intentions and plans for what they have just bought” may have to be looked into.