Wednesday, February 29, 2012

Acknowledgement of Unsustainable 'Frickin Killer Rent' Economy by Govt

Comments in parliament by MP Inderjit Singh:

"the day MNCs move out in large numbers, we will see a vacuum & a hollowing of our economy without a strong base of home grown companies."

"I recently spoke to some SME owners who are tenants in a JTC(govt industrial land agency) development in Toa Payoh which is now operated by a leading private property firm. Some of the tenants who are now negotiating a lease renewal with landlord face substantially higher rent at 40% increase. This is clearly an industrial policy gone wrong. We should never allow industrial land to be used for investors. Now what has happened is that the genuine companies who need industrial land have to pay way beyond what it should be & therefore they cannot survive as they also cannot compete with similar economies such as Taiwan, Korea or Malaysia."

"In fact, JTC should practice a differentiated land pricing policy because pegging industrial land to the market is not realistic in S'pore where the market for land is on the higher end of the curve due to shortage of supply. JTC should offer land based on prices offered in equivalent competing economies so that our companies can compete effectively,"

"There are many hidden taxes too - GST, high levies for foreign workers, series of duties & taxes on utilities & transportation, like COE & ERP charges, that add to escalating business costs."

Before this blog was started, i'm already peeved off by the high costs of living which is manipulated to the current dangerous & unsustainable level by the incumbent ruling party to benefit a small group of people.

Common sense would dictate that is unsustainable when we can buy stuff from ebay or other online retailers at a lower price. Unless desperate, why buy stuff locally & pay exorbitant killer rent component which many people exchanged their lifeforce in their daytime for a paycheck in a job they don't like.

I loathe eating with colleagues as i don't order drinks & i'm not willing to go with the crowd when it comes to ordering food thereby incurring higher expenses. Even when joining a group cycling ride in this tiny island i don't buy drinks. Before every ride i would load up with a drink & load my water bottles accordingly for the ride. I used to be a hardcore saver & deprived myself of many things in order to reach my savings target. Now i'm not so hardup on myself & learnt to 'blow' some $ by spending on minor treats during daytrips in JB, Msia.

While the darn incumbent party has finally come to the horrific realization about the hollowing out of the economy when MNCs move out due to killer rents, i wonder if is too late for this awakening. Being a cyclist i marvel at Taiwan which is also an asian tiger economy like S'pore in the past. In cycling industry Taiwan has spun off world industry giants like KMC(bicycle chains), GIANT(bike maker) & Topeak (bike accessories). Why niche crap does S'pore have? How can S'pore progress to the next stage when we have state capitalism running the country?

Yes REITs investors have benefited from the bloodsucking rents but the party is going to be over soon for reasons i've stated to a question-'Why I Consider REITs Risky'. Issue finally raised in parliament is an indication the situation is very bad already- it is a house of cards.

1 comment:

  1. And let's not forget Hon Hai Precision (iPhone maker), MSI (top motherboard maker), Gigabyte, TSMC (top chip maker), etc. These are top in their industry.

    And let's not forget Korea having their own niches.