Government of Singapore Investment Corporation (GIC)



Singapore Infopedia

by Lim, Tin Seng

Background

The Government of Singapore Investment Corporation (originally GSIC, now known as GIC) is a private investment company wholly owned by the Government of Singapore.1 Incorporated on 22 May 1981 under the Companies Act, GIC was set up as the government’s principal investment agent. GIC acts as a fund manager that oversees the investment of Singapore’s foreign reserves in long-term, high-yielding assets abroad.2

Reasons for forming GIC
GIC was the brainchild of
Goh Keng Swee who was then first deputy prime minister and chairman of the Monetary Authority of Singapore (MAS). It was formed against the backdrop of the rapid growth of Singapore’s foreign reserves in the 1970s.3 The accumulation of reserves was brought about by a set of economic factors that Singapore experienced during that period. These included a high savings rate, strong economic growth, and repeated budget surpluses. Concluding that these factors would remain, the government revised its investment policy. Instead of having MAS invest the bulk of reserves in liquid but low-yielding assets, the government sought to invest the reserves in long-term, high-yielding assets.4

The government wanted the investments to be managed by an indigenous investment agency even though local fund management expertise was still rudimentary. Initially, the government had considered using overseas fund managers but this had been decided against for two reasons. First, a local investment agency would give the government greater flexibility and control over the national reserves. Second, it would develop Singapore’s expertise in fund management.5
The government had envisaged the investment agency as a private company rather than a government body. This set-up would allow the investment company to respond quickly to market forces without the need to seek parliamentary approval for its decisions.6

Founding board of directors
Then Prime Minister Lee Kuan Yew chaired GIC’s first board of directors, with Goh Keng Swee as deputy chairman. The other founding board members were then MAS managing director
Lim Kim San, then Minister for Defence Goh Chok Tong, then Minister for Trade and Industry Tony Tan, then Minister for Foreign Affairs S. Dhanabalan, and then chairman of the Public Service Commission Tan Teck Chwee. The first managing director of GIC was Yong Pung How who was then vice-chairman of the Overseas Chinese Banking Corporation (OCBC) before his appointment to GIC.7

Local and overseas offices
GIC started operations in 1981 in the MAS premises located in the original Singapore Airlines (SIA) Building at
Robinson Road before moving to the MAS Building in 1985. As GIC expanded, it set up offices in Raffles City Tower in 1987 before relocating to Odeon Tower, then Capital Tower where it remains to this day.8 By 2010, GIC had eight overseas offices in key financial capitals – New York, San Francisco, London, Mumbai, Beijing, Tokyo, Seoul and Shanghai.9 Its latest office opened in Sao Paulo, Brazil, in April 2014.10  

GIC portfolio
GIC invests in a wide range of asset classes and instruments worldwide. They include public equities in both developed and emerging markets, fixed income, natural resources, hedge funds, cash and currencies.11
GIC manages assets in excess of US$100 billion, making the company one of the world’s largest sovereign wealth funds.12



Author
Lim Tin Seng



References
1. Tommy Koh et al., eds., Singapore: The Encyclopedia (Singapore: Editions Didier Millet and National Heritage Board, 2006), 220. (Call no. RSING 959.57003 SIN-[HIS])
2. Koh et al., Singapore: The Encyclopedia, 220.
3. Government of Singapore Investment Corporation, Year Book 2001 (Singapore: Government of Singapore Investment Corporation, 2001, 12. (Call no. RSING 332.6735957 GSICYB)
4. Government of Singapore Investment Corporation, Year Book 2001, 12.
5. Government of Singapore Investment Corporation, Year Book 2001, 12.
6. Koh et al., Singapore: The Encyclopedia, 220.
7. Government of Singapore Investment Corporation, Year Book 2001, 13.
8. Government of Singapore Investment Corporation, Year Book 2001, 14.
9. GIC Private Limited, Report on the Management of the Government’s Portfolio for the Year 2012/13 (Singapore: GIC Private Limited, 2013), 54–55.
10. Tee Zhuo, “GIC Opens Office in Sao Paulo,” Straits Times, 4 April 2014, 14. (From NewspaperSG)
11. GIC Private Limited, Report on the Management, 13.  
12. Koh et al., Singapore: The Encyclopedia, 220; GIC Private Limited, Report on the Management, 28. 



The information in this article is valid as of 12 May 2014 and correct as far as we are able to ascertain from our sources. It is not intended to be an exhaustive or complete history of the subject. Please contact the Library for further reading materials on the topic.

 








Rights Statement

The information on this page and any images that appear here may be used for private research and study purposes only. They may not be copied, altered or amended in any way without first gaining the permission of the copyright holder.

More to Explore

Association of Women for Action and Research

ARTICLE

Established in 1985, the Association of Women for Action and Research (AWARE) is a Singapore non-governmental organisation (NGO) concerned with issues of women’s rights and gender quality. AWARE seeks to eliminate gender-based barriers through research, advocacy, education, training and support services....

Chua Sian Chin

ARTICLE

Chua Sian Chin (b. 26 November 1933, Malacca–d. 26 February 2014, Singapore) was a former cabinet member and one of Singapore’s pioneer generation of leaders. A lawyer by training, Chua entered politics in 1968 after he was elected a People’s Action Party (PAP) member of parliament (MP) for the MacPherson...

Ho Rih Hwa

ARTICLE

Ho Rih Hwa (b. 1917, Singapore–d. 28 August 1999, Singapore) was a prominent businessman and ambassador. He headed the Wah Chang group of companies, a business conglomerate engaged in agribusiness, hotel and resort management, as well as property development in Burma (presently Myanmar), Taiwan, Singapore, Thailand, Malaysia and China. In...

Tan Chin Tuan

ARTICLE

Tan Sri Tan Chin Tuan (Dr) (b. 21 November 1908, Singapore–d. 13 November 2005, Singapore), nicknamed “Mr OCBC”, was a prominent Peranakan philanthropist, and often credited as the man who built the Oversea-Chinese Banking Corporation (OCBC). ...

Economic Development Board

ARTICLE

The Economic Development Board (EDB) is a statutory board established on 1 August 1961 to spearhead Singapore’s industrialisation programme. Presently, the board plans and executes strategies to enhance Singapore’s position as a global business centre, and its mission is to boost the economy with vibrant business and good job opportunities....

Singapore Institute of Management

ARTICLE

The Singapore Institute of Management (SIM) was founded on 28 November 1964 to train first-class managers for the Singapore economy. Today, SIM comprises three distinct arms: SIM Global Education, SIM Professional Development and SIM University....

Cabinet 2001

ARTICLE

Cabinet 2001 was announced by Goh Chok Tong, then prime minister of Singapore, on 17 November 2001. The swearing-in ceremony was held on 23 November 2001 in the presence of S. R. Nathan, then president of Singapore, at the State Room in The Istana. It was the last cabinet under...

Staff Training Institute (Civil Service College)

ARTICLE

The Staff Training Institute was set up in 1971 by the government for the training of civil servants in order to enhance the efficiency of the public sector. The establishment of the institute marked an important milestone in the training of civil servants in Singapore....

Albert Winsemius

ARTICLE

Dutch economist Albert Winsemius (Dr) (b. 1910, Netherlands–d. 1996, The Hague, Netherlands) was an economic advisor to the Singapore government for 24 years. During that time, he contributed greatly to Singapore's economic development....

Singapore's presidents

ARTICLE

Between 1959 and 1965, Singapore’s head of state was known as the Yang di-Pertuan Negara (Malay for “Head of State”).The post was created to replace the governor as head of state when Singapore attained self-governing status under British rule. When Singapore became an independent nation on 9 August 1965, the...