Singapore
plunge on Suzhou investment scary to China
South China Morning Post.
February 26, 2000
BY BARRY PORTER in Singapore
RELATED: The Suzhou saga
BEIJING has reported a "scary" slowdown in investment from Singapore following the high-profile bust-up over their joint venture - Suzhou industrial park.
Singapore investment in the mainland slumped 23 per cent to US$2.62 billion last year, according to the latest statistics compiled by Beijing's Ministry of Foreign Trade and Economic Co-operation.
Dong Songgen, minister-counsellor for economic and trade affairs at the Chinese Embassy in Singapore, described the downtrend as "scary".
"There is no reason why Singapore investments and trade with China should lag behind Europe and the United States," he said.
Mr Dong partially attributed the sharp fall in Singapore investment commitments on the regional financial crisis.
Observers believe the sour experience from investing in the Singapore-Suzhou Industrial Park may have been an added factor.
The Singapore government announced in June that it would hand control of the industrial park over to its mainland partners in January next year after completing just the first eight square kilometres.
The partners had envisaged building a model park covering 70 sq km, but the Singapore side became frustrated over the Suzhou municipal government's apparent favouritism for a nearby rival industrial park, breaching assurances from Beijing.
The Singaporeans will cut their stake in the development from 65 per cent to 35 per cent next year.