11 July 2006

Some Insights Into GIC

ST July 11, 2006
GIC aims to broaden portfolio: Tony Tan
By ST Interactive reporter, Jermyn Chow

THE Government of Singapore Investment Corporation (GIC), which manages Singapore's reserves, will put more money into emerging markets, private equity and hedge funds to broaden its portfolio of more than US$100 billion.

GIC Deputy Chairman and Executive Director, Dr Tony Tan, singled out China and India, as the two emerging power houses that will see the greatest economic transformation this century.

Their potential areas of investment, as well as those of Southeast Asia, cannot be ignored, said Dr Tan.

'Emerging markets is increasingly an area where the GIC will be investing its funds. It will be a focus for GIC in the coming years,' he said.

GIC's share of investments in the United States has recently declined to 40-45 per cent, while 20-25 per cent of its assets were invested in Europe, 8-10 per cent in Japan and the rest in emerging markets.

Speaking at a press conference ahead of its 25th anniversary dinner on Tuesday, Dr Tan said the 'milestone in GIC's corporate history' is an opportune time to take stock.

'GIC's investment objective is to preserve and enhance the international preserving power of Singapore's reserves,' he said.

'The Government views these reserves as assets for present and future generations of Singaporeans and hence regard GIC's investment performance over the long term as more significant than short-term results.'

Dr Tan said since its inception in 1981, GIC has grown in size, breadth and depth.

From a few officers when it started, it now has more than 800 staff, of whom about half are professionals. About 36 per cent of the professionals are foreigners.

Starting with a fund size in 1981 of several billion Singapore dollars, GIC now manages well over a hundred billion US dollars, with investments in over 40 countries.

'GIC has done well because of its people..To continue to do well, GIC must continue to attract and retain top talent,' Dr Tan said, adding that GIC also welcomes global talent and is determined to offer them attractive and satisfying career prospects.
I don't really have any insightful analysis to offer for this article. I decided to post it anyway because it's quite rare to have a senior GIC official publicly say anything about GIC at all. GIC is a highly secretive organisation.

Not that Tony Tan said anything particularly amazing. "GIC Deputy Chairman and Executive Director, Dr Tony Tan, singled out China and India, as the two emerging power houses that will see the greatest economic transformation this century". Duh. As if we didn't all already know that.

I once interviewed for a job at GIC. They wanted a lawyer who could advise on tax-driven asset securitisations on a multi-jurisdictional basis. At that time, I had only the faintest idea what "tax-driven asset securitisations on a multi-jurisdictional basis" were. But I thought that the term sounded cool, so I told the interviewer that I was looking for new career challenges and was eager to learn new things.

However, the interviewer warned me that the work would actually be quite dry, repetitive and boring. She said that if I was really looking for interesting work, then this might not be the right job for me. I said, "Errrr, in that case, you're probably right. No worries then, goodbye." And I left.

Surprisingly, GIC's HR person called me to fix a second interview. Even though I thought I'd made it clear that I wasn't interested anymore. I didn't want to be impolite, so to ward them off, I quoted, over the phone, an unreasonably high figure for my expected salary. If I remember correctly, it was about 40% higher than what I was then drawing - and bear in mind that for the GIC role, I had no relevant experience.

The HR person hung up. But to my surprise, she called back two hours later saying that GIC was okay with paying my expected salary and please would I come for a second interview asap as GIC's legal department was quite keen on me.

I agonised over this for a grand total of one minute. Then I said I wouldn't be coming. I really didn't want to be stuck in a boring job, I told the HR person (and that was true). The HR person hung up. This time, that was really that. My mother scolded me for not going for the second interview, but I know myself - boring jobs are hell for me.

Looking back now, I'm quite surprised by GIC's strong interest in hiring me. Even today, if I needed to hire a lawyer for tax-driven asset securitisations, I wouldn't hire me. I just don't have the relevant experience. I would throw out my own CV straightaway - not even a first interview.

Tony Tan says that more than half of GIC employees are professionals, and 36 per cent of the professionals are foreigners, and GIC is determined to offer them attractive and satisfying career prospects. I just wonder how many of these professionals might or might not actually have any relevant experience.

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Past Musings: "Newly-qualified teachers are encouraged to apply" - click to read about a recent example of zero-experience foreign talents being wooed to come to Singapore.

16 comments:

moomooman said...

hahaha...

When you ask for 40% more than what you were drawing with no relevant experience and they want you real bad....

It just shows you must be really underpaid.. and they think you were a steal.

You know I'm joking.

Or they were too hook into "emerging markets" and see how emerging you have become now.

moomooman said...

Also... their HR manager also quite powderful.

They actually understood "tax-driven asset securitisations on a multi-jurisdictional basis" to know that it's dry, boring and repetitive.

Anonymous said...

They thought you were just playing hard to get. It's because you had the 'confidence' to ask for a 40% pay rise. In that case, he must really be good, and we should - no, must - hire him.

Anonymous said...

"tax-driven asset securitisations on a multi-jurisdictional basis"

= they did some tax planning work in a few countries, so need you to draft contracts?

I don't know what they do. Really man, secretive like anything.

thor666 said...

GIC pays very well, judging from the fact that they pay 1000SGD just for an intern.

My guess what GIC does is simply, find the companies with the best potential, buy over, and earn long term profits. I believe also that the liquidity of funds in the company is much faster than a normal company, which enables GIC to move early.

Somewhat similar to Temasek Holdings, except Temasek Holdings is one which manages on an official front.

porcorosso said...

hmm ... is that job still there? :)

Anonymous said...

I applied for a IT position before as well. I don't have fantastic Os, Dip and degree results, but i got more experience then they require. But i got absolutely no reply from them at all.

So I guess, "Paper results" are still very important for them.

And I got a friend who use to work in NASA (fantastic results type), GIC offered him about 40% more then what NASA is paying him too!!!!

Don't the garmen have some SOP to follow when it comes to employment pay packet and benefits? You mean they can chin chai pay this fellow 40% more, that fellow 80% more, another fellow 30% more one meh?

Anonymous said...

US100 BILLION? And Mr Brown has to go for means testing for his daughter? Come on. Let us spend US 1 billion, just one, on the Children of Singapore. No means testing if you are a Singapore Child. Equality for all. Singapore Procreate, I pick up the hospital bills. And build up our KK Children hospital to be the best in the world. I do wonder what they are doing to our hard earned reserves? Just squirrel away and squirrel away more? to Hit $200 billion and then what?

Anonymous said...

Maybe must do some 'koyok-selling' to maintain stakeholder confidence after some recent fiascos like the Shincorp thingy.

I remembered this one average Singaporean who wrote in to advise against going through with the deal. His unconstructive criticism would have saved us a billion dollars, at least.

Quality debates are good but not very constructive either.

The Government like overpaying for talents with no relevant experience. Yet, they insist that the opposition is bad because they have no track records.

I had gone for GIC interviews too. It is amazing why they keep emphasizing the boring aspects of the job. Maybe they know Singaporeans don't like boring jobs so they would be free for the foreign talents to pick up.

Anonymous said...

aiyah, Mr Wang, they knew you were a star student in uni and a "high-flyer" lawyer what.
If you ask for the moon, they also give you one lah. hahaha

Henry said...

Your tale of the job offer at GIC is scary, but not uncommon. The HR person clearly knew you had no relevant experience, and yet was prepared to offer you above market rates. The job description "tax-driven asset securitisations on a multi-jurisdictional basis" was pure bullshit, a creative piece of copy writing. Why would GIC pay top dollar for "dry, repetitive and boring" work? It confirms what we all suspect: there are lots of civil servants out there wasting our tax monies on non-productive "work". A school mate of mine and President scholar was assigned this job monitoring fuel prices at the utilities board. After umpteen years, his department has grown and so has his job title and income tax bracket. But the job is the same, and there's not a thing he can do about addressing the problems associated with rising oil prices.

Anonymous said...

I wonder would you be in a danger of receiving a letter from some GIC press secretary claiming you for distorting the truth. That you are polemic dressed up as analysis on how the GIC’s HR operates suggesting that their ‘talents’ are actually not up to par and offering no alternatives or solutions. And that you try to encourage cynicism and despondency, which can only make things worse, not better, for those you profess to sympathize with. :P

On second thought, nah, it is not as if the govt is treating blog as a serious mainstream media. :P

Anyway, I was also under the impression that paper qualification is very important for any govt linked organizations or companies when coming to recruitment or promotion. And they are not petty and willing to pay good money if you have some good qualification to show. Experiences on the other seem more secondary..

Some of my friends gave up their civil or GLC related jobs years ago when they realized that promotion seem to become more like a routine for those with better paper qualification and not actually based on experiences and performances alone, and that ‘average joe qualification’ like them would never be able to get the top ranking jobs no matter how capable and talented they are. It is especially disheartening for them when some young scholar upon returning from fresh graduation would immediately be assigned to top post and become their superior despise the fact that non-scholar like them had been working for years and showing good results in their performance. But that is like a decade ago, maybe thing changed for the better now? :P

Anonymous said...

Let me see if I get this..

Our mandatory CPF savings are invested in "risk-free" Singapore government bonds. So the citizens are forced to lend their mandatory savings to the Singapore government. The government "guarantees" on their word that it will pay us back the CPF on retirement. The GIC and Temasek Holdings invest the "reserves" of Singapore, which include the money which it has "borrowed" from the citizens through Singapore government bonds.

So if (touch wood) things go badly at GIC and Temasek and they do not have enough money to pay back the money they borrowed from the Singapore government bonds.. how will the Singapore government bonds have money to pay back our CPF when we retire?

Gahmen say we cannot say got problem unless we can offer solutions.

So I offer the possible solutions:

1) Increase CPF withdrawal age so we do not have to pay the citizens so quickly. Hopefully more of them will conveniently die off before we have to pay back.

2) Increase CPF minimum sum so that we do not pay off so much so suddenly as the population all turns 62 at the same time.

3) Increase HDB prices so we do not neeed to pay back so much money since the money has been used to buy overpriced HDB flats. The HDB flats return to the government after 99 years anyway.

4) Increase medical costs and education costs. If citizens have spent that money on medical and educations costs, we do not have to pay back that CPF when they retire.

And most importantly..

5) Use the CPF payments from the current generation to pay the CPF retirement funds of the previous generation.

Dr Oz bloke said...

The returns that GIC has achieved is pathetic!

We are much better off just parking our money in the US S&P 500!

I have written an entry about this at my blog.

GIC is taking us for fools!

Anonymous said...

Yup, the paper's headline of GIC's "above average" returns is yet another spin article. 9.5% average over 25 years is hardly impressive. In fact, GIC has underperformed the Dow, which moved from about 900 in 1980 to 11000 today.

So, i could have dumped my money in the Dow, gone on a 25yr holiday, without paying "foreign talent" "asset managers" overinflated wages, undertook much less risk (GIC by its own account claims to take on higher risk for higher return) & still out performed GIC.

Anonymous said...

Temasek just got US$2 billion wiped out from its investment in Shin Corp's ITV yesterday. Has the 140th reported this yet?