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Guidelines for sovereign wealth funds (SWFs) crafted by counterparts from the United States and Abu Dhabi apply to Singapore’s investment arm Temasek Holdings, the finance ministry clarified on Tuesday. Temasek initially said it was not affected by the new guidelines reached between the two countries and the Government of Singapore Investment Corporation and unveiled last week.
“We are not a sovereign wealth fund,” said a Temasek spokesman. “Temasek has to sell assets to raise cash for new investments and doesn’t require the government to give approvals.”
The guidelines seek to ease concerns between SWFs and the countries receiving the investments by affirming they are purely for commercial reasons and will not lead to protectionist measures.
Since Temasek is wholly owned by the government, the ministry said the policy principles for SWFs are relevant.
“The policy principles for SWFs are broad guidelines that take into account the diversity of SWFs and the different contexts they operate under,” Laurence Lien, the ministry’s governance and investment director, told The Straits Times.
Temasek’s annual reports already exceed the disclosure standards set out by the policy standards, he noted.
The government’s relationship with Temasek is that of a sole shareholder. The GIC manages assets on behalf of the government.