21 Nov 2001
It's all in the family as No.1 son ascends
THE family of Singapore strongman Lee Kuan Yew
has strengthened its grip over the island state with the promotion of eldest son
Lee Hsien Loong to the finance ministry.
The move - as part of a cabinet reshuffle - comes as Singapore descends further
into its worst recession since it won independence in 1965.
Data released on Friday showed Singapore's economy has contracted this year at
an annualised rate of 11 per cent.
Lee Hsien Loong's promotion gives his family unprecedented authority over the
troubled country's economic, business and political affairs.
Lee family members now dictate Singapore's monetary policy, via control of the
central bank, and its economic policy, via the finance ministry. They also fill
the roles of chair and deputy chair of the nation's biggest investment company.
And they run the country's biggest unlisted conglomerate and its biggest listed
company.
Corporate Singapore frequently claims that it adheres to so-called world's best
practices of corporate governance and transparency.
However, as governments seek to separate the functions of state, it's rare for
the same person to run both the central bank and the finance ministry.
The cabinet re-shuffle was announced on Saturday, with no suggestion that Lee
Hsien Loong, 49, will step down as chief of the de facto central bank, the
Monetary Authority of Singapore (MAS).
He is also Deputy Prime Minister and deputy chairman of the Government
Investment Corporation, the $US120 billion national "fund manager"
that is the acme of economic muscle in Singapore.
The GIC invests Singapore's national reserves by agreement with Lee Hsien
Loong's MAS. And the GIC chairman is his father, the so-called Senior Minister.
In the political sphere, the Lees may no longer hold the position of Prime
Minister - currently filled by Goh Chok Tong. But few Singaporeans doubt that
real political power still lies with Lee Kuan Yew, who officially stood down as
PM in 1990.
In business, the Lee family controls the nation's biggest listed company,
Singapore Telecommunications, where youngest son Lee Hsien Yang has been chief
executive since 1995.
SingTel recently took over Australia's second-biggest carrier Optus in a
long-running and often bitter battle during which government-owned SingTel
repeatedly claimed it was run without government influence.
The Lee family also control Singapore's biggest unlisted conglomerate, Singapore
Technologies, where Lee Hsien Loong's wife, Ho Ching, is chief executive.
Lee Hsien Loong's promotion to the finance ministry is seen as a final step
before he takes over as Prime Minister. That will be assured if he can
successfully guide Singapore out of recession.
The ruling People's Action Party was recently returned to power in a walk-over
election, with Goh said he would step down as PM before the next poll, which is
due by 2007.
The weekend cabinet re-shuffle also saw a number of senior figures from
Singapore business enter politics. It's common in Singapore for government
"business" officials to have dual careers in politics.
For instance, Raymond Lim is managing director of Temasek Holdings, the
government's main domestic holding company that controls SingTel, SingTech and
Singapore Airlines. He will also become a minister of state for foreign affairs
and trade. Similarly, senior Singapore Airlines official Cedric Foo gets a
ministership at defence.
Singapore Airlines has been in negotiations to take a leading role in the
resurrection of Ansett.