Update on the study of a specialised financial institution to handle cross-border financing for local SMEs19 May 2010
Date: 19 May 2010
Parliamentary Question by Mr Teo Siong Seng:
To ask the Minister for Finance whether he will provide an update on the study of a specialised financial institution to handle cross-border financing for local SMEs as proposed by the Economic Strategies Committee.
Reply by Finance Minister Tharman Shanmugaratnam:
1. The study that Mr Teo had asked about is still underway. The Government is evaluating how best we can realise the development of a market-based institution, to support and catalyse cross-border financing for Singapore-based companies.
2. The study includes an assessment of the various possible business models for such an institution. It involves discussions with both companies and banks, as well as with Export-Import (EXIM) banks and Export Credit Agencies (ECAs) of other countries who can give us a detailed understanding of how they operate in the marketplace.
3. We would like to find an approach that is commercially sustainable, and which also stays relevant through business cycles and not only at times of crises. We should also not rush into duplicating models elsewhere but instead explore solutions that meet the needs of our companies and address the gaps in our financial market.
4. In the meantime, IE Singapore continues to support cross-border financing through existing schemes like the Loan Insurance Scheme (LIS) and LIS+, the Export Coverage Scheme (ECS) and the Internationalisation Finance Scheme (IFS).