Official Foreign Reserves and Assets under GIC's Management

Parliamentary Question by Mr Gerald Giam Yean Song:

To ask the Deputy Prime Minister and Minister for Finance as the Official Foreign Reserves (OFR) managed by MAS currently stand at 70% of GDP and the Reserves Management Government Securities held by MAS can bring the OFR to 106% of GDP, whether it is still necessary to avoid publishing the total assets under the management of GIC so as to defend the Singapore dollar against speculative attacks.

Parliamentary Reply by Deputy Prime Minister and Minister for Finance, Mr Lawrence Wong:

MAS has explained that the amount of official foreign reserves, or OFR, needed to ensure confidence in Singapore’s exchange rate-centred monetary policy and in Singapore’s macroeconomic stability is between 65% to 75% of GDP. The OFR ensures that MAS has the wherewithal to defend the Singapore dollar against speculative attacks. But we need to prepare for more extreme tail-risk scenarios. That could include a crisis of unprecedented scale, that causes an outflow of capital in excess of what MAS holds. It could also be emergency scenarios precipitated by state or non-state actors that threaten our economy and livelihoods, or even our existence as a nation. Recent events around the world have underscored that our peace and security should not be taken for granted. Just as our defence forces do not reveal the full extent of our weaponry and military capabilities, it is not in Singapore’s interest to disclose the full size of our reserves.