Today Weekend: Gaynomics The H question Hu's headache (Oct 27)

Saturday, October 27, 2007

Gaynomics The H question Hu's headache

Weekend • October 27, 2007

P N Balji
Christie Loh
Rosnah Ahmad

ONE thing is for sure. The Parliamentary debate on Section 377A, which makes sex between homosexuals a crime, is not the end of the story. The issue will come up for public airing again when morality is confronted with money.

The PM's speech, which tried to strike a nice balance between allowing gays space and appeasing the religious and conservative groups that this space will be managed, told something else about policy making.

When it comes to moral issues, the Government will prefer to be below the curve but for others, like the economy and education, it will lead the curve.

What if the morality and economic lines become blurred, like it happened in the casino debate? Well, the answer is there for all to see in Sentosa and Marina Bay.

So, like with many things in Singapore, the Minister Mentor might be proven right after all. Get ready for gaynomics.

TO HEDGE or not to hedge? Poor Mr Wee Sing Guan. The former finance director of SembCorp Marine has just discovered the heavy price of using derivatives to act as buffers against sudden price fluctuations.

His bigger gamble was to do it without permission. And so SembMarine joins Barings Bank, China Aviation Oil and Mitsui to come under the public glare because their executives predicted wrongly what the price could be over a certain period.

Had a right call been made, those companies — like SIA — would have booked huge profits or savings.

But the beauty of hedging often doesn't come easy. The risk can be high, especially when multi-million dollars are involved.

Until SembMarine offers more information, bystanders will be wondering why the US$248 million ($361 million) losses, exceeding the publicly-listed, Temasek-linked company's profits last year, went unnoticed. And for how long?

Yet another bitter lesson for Corporate Singapore to learn that blind trust, especially in a single person, can spell disaster. No hedging on this anymore, please.

DIG a little deeper into the background of the line-up that has been handpicked to run tomorrow's China, and a little detail sticks out. Eighteen of the 25 members of the ruling elite, the Politburo, had worked in the provinces, suggesting that President Hu Jintao's focus will be now on tightening central control.

Mr Hu has been uneasy with the rise of these little provincial chieftains, who had shown signs of being power-hungry and reluctant to follow central government rules. They pushed enterprise at any price — even if it meant polluted factories and a lack of healthcare programmes. After all, their promotions were tied to their provinces' growth.

The Wall Street Journal says that by packing the new Politburo with former provincial leaders, Mr Hu is signalling that he is likely to take back even more powers from local governments in the next five years. And he must be hoping that his new Politburo members will provide the balm to ease the headache.