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1988: Singapore seeks MNCs, oil futures trading

MNCs wooed to help formulate economic strategies, CPF rates adjusted, oil futures market idea explored.

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Multinational corporations (MNCs) were an important component of economic strategy 28 years ago.

As Singapore sought to join the ranks of developed countries, foreign businesses offered a way to accelerate the journey, bringing in valuable investments, imparting skills and technologies and creating jobs.

At a conference initiated by the Economic Development Board (EDB) in October 1988, some 1,000 government officials and executives from selected MNCs such as AT&T and Royal Dutch Shell convened to discuss economic strategies and policies. It was the first time EDB collaborated with eight other statutory boards - the NCB (National Computer Board), Telecoms, TDB (Trade Development Board), PSA (Port of Singapore Authority), CAAS (Civil Aviation Authority of Singapore), JTC (Jurong Town Corp), STPB (Singapore Tourism Promotion Board) and the PUB (Public Utilities Board) - in a concerted effort to promote “Singapore Inc”.

In April that year, CPF (Central Provident Fund) contribution rates for employers got bumped up two points to 12 per cent, following “exceptionally high” economic growth in the first three months - also the highest quarterly growth (11 per cent) since the government started producing quarterly figures in 1975.

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CPF contribution rates for employees were lowered by a point to 24 per cent. Employers, who had been given indications of a CPF increase weeks before, found the raise to be reasonable, fair and realistic; some had anticipated a bigger rise.

Meanwhile, the momentum for an oil futures market in Singapore started quickening around February. Oil companies and traders were invited by the Monetary Authority of Singapore to a meeting that month to explore the establishment of oil futures trading.

The Business Times reported that Singapore had been discussing the possibility of a link-up between the Singapore International Monetary Exchange (Simex) and the New York Mercantile Exchange (Nymex) which would allow for extended trading hours.

Then, Nymex was also holding discussions with Tokyo on a link-up, and traders had predicted that oil futures would be unlikely to take off first in Singapore.

The Business Times has been there to report and analyse the most significant news since 1976. Every week, this feature will showcase excerpts from the biggest stories for each year that the paper has been in operation. The full text of all the stories can be found online at bt.sg/bt_40

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