drops control of Suzhou park
South China Morning Post June 29, 1999
BARRY PORTER in Singapore
RELATED: Suzhou Park saga
SINGAPORE is to cede control of its US$30 billion showpiece Suzhou Industrial Park amid anger over the mainland's apparent betrayal and lack of commitment.
The joint venture, a pet project of Singapore Senior Minister Lee Kuan Yew, had been intended as a symbol of Sino-Singapore economic relations and a litmus test for future investment.
However, after five years' hard slog, it has ended up a prime example of how such projects can go wrong.
Months of fruitless complaints and hollow promises ended yesterday with Singapore signing a new agreement with the mainland to scale back significantly its involvement in the 70 square kilometre park after completing just the first eight sq km.
On January 1, 2001, Singapore will cut its stake in Suzhou Industrial Park from 65 per cent to 35 per cent, at the same time yielding day-to-day management control. At the outset in 1994, Beijing promised that the mega-project would enjoy special priority status and help as a reward for Singapore transferring technology and management know-how.
Instead, Singapore's supposed joint-venture partner, the Suzhou municipal government, has opened a rival bargain-basement industrial park virtually next door, which has stolen potential tenants away.
The deal to scale back Singapore's involvement was struck in Singapore after talks between delegations headed by Singapore permanent trade and industry secretary Khaw Boon Wan and Suzhou party secretary Liang Bahua.
Mr Khaw said: "Like all big projects, we have encountered problems in implementation.
"Out of these serious consultations, we have pragmatically acknowledged the operating constraints and successfully formulated a good package of solutions on the best way to advance the project under the circumstances."
Under the new deal:
So far, the Sino-Singapore park has attracted 133 projects and investments totalling $3.7 billion.
After initially keeping tight-lipped, Singapore has been unusually vocal in its criticism of the mainland's mishandling of the slow progress of the project in recent weeks.
Philip Yeo, chairman of Singapore's Economic Development Board, said yesterday: "The key thing here is logistics [and] culture. They do things differently."
Senior Minister Lee waited until December 1997 before publicly airing his frustrations with Chinese President Jiang Zemin, who quickly promised the park would get priority over others, but competition from Suzhou New District persisted.
Earlier this month, Mr Lee said: "We are not happy because we are not getting the kind of attention we were assured we would get - special attention. Indeed, what we are getting now is competition."
Published in the South China Morning Post. June 29, 1999.