SDP questions “rescue” of Sembcorp Marine

January 20, 2016
Singapore Democrats

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Singapore Democrats

The SDP has learnt that Sembcorp Industries “might inject funds” into its subsidiary Sembcorp Marine to “replenish finances strained by a collapse in oil prices.”

Sembcorp Marine is reported to have incurred huge losses after its dealings with customer Sete Brasil, an oil-drilling company, went sour. Sembcorp Marine and Keppel Corporation build oil-rigs for Sete Brasil which is said to be considering filing for bankruptcy because of a crash in oil prices. The Brazilian company is also facing charges of corruption.

The SDP calls for the immediate release of Sembcorp Marine’s and Keppel’s financial status and how much funds Sembcorp Industries will have to put up to help out its subsidiary.

The SDP is against the practice of the PAP government using public funds to rescue troubled Government-linked companies (GLCs) with little accountability to the public. The Singaporean people are not consulted on how Temasek invests our funds and should not have to shoulder its losses. This is especially problematic when profits are not equitably distributed to Singaporeans.

In addition, news of Sembcorp Industries’ rescue caused shares prices of Sembcorp Marine to jump by as much as 8 percent at one point in today’s trading. Public money should not be used by the government to benefit private investors in the stock market.

Sembcorp Industries owns 61% of Sembawang Marine. Sembcorp Industries is, in turn, owned by Temasek Holdings (49.5%) and Public (50.5%).

There are many questions surrounding this latest announcement, many of which can only be answered with Sembcorp Marine and Keppel Corporation releasing their financial reports.