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Parliamentary Replies

Government Bonds To Finance Infrastructure Projects

05 Feb 2018

Parliamentary Question by Ms Sun Xueling:

To ask the Minister for Finance whether the Ministry will consider issuing Government bonds or project level bonds to finance mega infrastructure projects like Changi Airport Terminal 5 and Tuas Mega Port.

Parliamentary Reply by Minister for Finance Mr Heng Swee Keat:

Bond financing by statutory boards and government companies are one way to finance infrastructure projects.  We already do this today.  For example, statutory boards like HDB, LTA and PUB have issued bonds to finance public housing, rail and water infrastructure.   

2.    Such borrowings enable the capital cost to be spread out over a longer period, thus better matching the cost with the benefits over the useful life of the asset. But we also need to consider interest costs, and ensure that there are adequate future revenue streams from the project to service the debt. 

3.    For the major infrastructure projects that are upcoming, the Government will study the extent to which bond financing can be used, bearing in mind the key principle of ensuring fiscal sustainability.