Thursday, February 22, 2007

Singapore Stocks Performing Well, More Developments

The Singapore Stock Market hit a record on Wednesday and our Singapore Fund holding (NYSE: SGF) is one of the few stocks that are up in face of today's slide in the stock market. The proposed reduction in corporate taxes are expected to have very positive implications for corporate profitability. There is also news that a Consortium has exercised its option to develop the second phase of Singapore's Downtown. They are expected to build office and high-end residential components in the new phase.

With only 692.7 sq km in the entire country of Singapore, residential and commercial building is scarce. The relaxation of the corporate tax and the building of a casino industry in Suntec City should attract a business migration into Singapore - or at least this is what the government hopes will happen. Singapore does stand a chance with its english speaking diverse nation and pollution free business friendly environment.

What does mean? We continue to be very bullish on all things Singapore, including the Singapore dollar, the Singapore fund and Singapore real estate.

Here is a picture of the downtown area in development courtesy of Channel NewsAsia

Tuesday, February 20, 2007

Singapore Becoming Southern California?

When we think about Southern California, we tend to think about beautiful waterfronts, huge homes, warm weather and a relaxing atmosphere. We are not alone since such pleasant thoughts are shared by many West Coasters who have chosen to vacation and live in Southern California. This optimism has become so extreme that it has created a bubble in the housing market.

Today, Singapore wants to become Southern California. Sentosa which is 15 minutes away from the center of Singapore is being built to be just that. The 1230 acre island has a gated community with luxury homes and a yacht marina and is the annual host of the Singapore open. A casino has been approved to be build in Sentosa, which should drive a huge wave of construction that will include the usual luxuries like hotels, spas and shopping malls.

After a slow start, property in Sentosa is selling like "hot cakes" according to the director of property for the Sentosa Leisure group.

"Sentosa Cove is the only place in Singapore where non-permanent residents can buy land; 60% of buyers are foreign — almost all from Asia — and the rest are local. (Local law bars foreigners from buying land in Singapore unless they can show assets of $13 million and deposit at least $3 million in a Singapore bank.)"

To learn more about Singapore's quest to become a main tourist destination, read on!,1,1441729.story?coll=la-travel-headlines

Singapore to Engineer the Strongest Currency in 10 Years?

According to the International Herald Tribune, ING Bank is predicting sharp gains in the Singapore dollar this year as improving growth and inflationary pressures force the Monetary Policy of Singapore to tighten the eonomy by increasing the value of the currency.

Interestingly enough, the MAS manages the Singapore economy using the currency instead of exchange rates.


Singapore is doing alot to spur growth. Last week, they announced plans to cut corporate taxes by 2 percent to compete with the corporate tax rate offered in HK

Monday, February 19, 2007

Macau - The Quest for Casino Space

Macau is a mere 50 minute boat ride or 16 minute helicopter from HK, the gateway to China. Their proximity to the Asian Giant has made the former Portuguese territory a hot investment destination for foreign companies that are craving a piece of the casino business. In fact, even companies that have never dabbled in the casino industry like the Virgin Group have expressed plans to develop a casino in Macau.

Unfortunately their plans have fallen through but they havent given up.

Perhaps they will end up collaborating with casino mogul Stanley Ho who lost his hold on the Macau gaming industry when China deregulated the casino industry in 1999 after they took over the colony. Ho use to be the sole owner of the casinos in Macau but he may be branching out though as recent donations to Australia's Labor Party suggests that he may want to start developing casinos in Australia.

"Star City Casino in Sydney was given exclusivety for 12 years when it opened in 1995. That exclusivety runs out in six months time."

Ho's political donations have sparked casino rumors

Friday, February 16, 2007

Vietnam - Big Goals for 2007

The Ministry of Trade in Vietnam has big goals for 2007. They expect export growth to rise by a minimum of 17.4 percent this year and are actually aiming for growth in excess of 20 percent. Strong exports are good for GDP and the government has set a 2007 GDP growth rate of 8.5 percent.

In an interview with VietNamNet Bridge Minster of Trade Truong Dinh Tuyen explains where he expects to see export growth to come from:

In a nutshell:

He expects exports of the following products to rise -

1) Industrial and mechanical products like small engines and boats
2) Apparel Exports
3) Seafood and Farm Produces

And exports of these products to fall -

1) Crude Oil
2) Coals
3) Rice

But be careful of capital controls!

There have been reports today that Vietnam may want to impose capital controls to tame the roaring stock market and the hot speculative capital that is rushing into the country. The stock market rallied 144 percent in 2006 and is up 46 percent this year. The government's fear is that local investors will be burned in the market pulls back.

Although total foreign participation in the [Vietnamese] stock market is still about one-third, most of the in-demand and big-cap stocks are approaching or at their respective foreign investor limit" of 30 percent or 49 percent, depending on the sector, Credit Suisse said. In addition, average daily equity trading volume tripled in the past two months, it said.


If Vietnam opts to follow in the footsteps of Thailand who imposed penalties on foreign investors withdrawing assets within a year this past December, we could see a pullback in Vietnamese stocks. When Thailand announced the capital control, the Bangkok stock index fell 15 percent in one day.

If this happens, I will be looking for cheap investments!

Thursday, February 15, 2007

The DOs and DON'Ts of doing business in Vietnam


DOs and DON'Ts to doing business in Vietnam


• Expect to drink a lot of coffee and tea (some sources say turning down a beverage offer is considered impolite).

• Prepare for working lunches and dinners.

• Expect very difficult traffic on the streets.

• Plan for logistics delays or longer leadtimes when shipping product out of Vietnam.

• Expect air and noise pollution in major cities.

• Bring more business cards and copies of materials than you expect to need. Many businesspeople report meeting more contacts than they expected to in Vietnam.


• Put your Vietnamese colleagues in a position where they may lose face.

• Talk about the Vietnam War (they refer to it as the American war) in business relationships. In fact, avoid politics altogether in conversation.

• Rent a car. Find someone else to drive you, at least for your first visit.

• Expect to find access to raw materials in Vietnam.

Link to full article

Vietnam - Defying Misconceptions

To many, Vietnam may still seem like a third world nation that is leap years behind countries like China and Singapore. However this common misconception is usually from people who have never visited the country. First hand looks at production and manufacturing facilities reveal that Vietnam is more modernized than many of us can imagine:


Whatever you think you know about business in Vietnam, forget it. The economic and business environment in today’s Vietnam surprises most U.S. buyers that visit the country in search of low-cost, high-quality suppliers.

“My personal image—as well as those of most of my associates—prior to visiting Vietnam, was one of manufacturing facilities with dirt floors and sweat-shop type atmospheres,” says James Malch, senior supply chain manager for Pacific Scientific’s Electro-Kinetics division in Carpinteria, Calif., which buys alternator parts from Vietnamese suppliers. “But after visiting several different suppliers in various industries such as stamping, PCB assembly, machining, and wiring and harness assembly, I was very impressed. Once I was inside the building, I could not tell I was in a foreign country."

This only scratches the surface, to read more from other supply chain managers, check out this article: