SHOCKING: Singapore is one of most indebted countries in the world despite large govt surpluses
Posted by temasektimes on June 4, 2012
Singapore has become one of the most indebted countries in the world despite supposedly running large and sustained government surpluses, wrote Professor Christopher Balding (pic left) from HSBC Business School, Peking University Graduate School in a landmark paper on Singapore’s sovereign wealth fund Temasek Holdings.
In the paper, Professor Balding revealed that there is a “minimum of $350 billion SGD or $275 billion USD unaccounted for from historical surpluses and financing operations” based on publicly available economic data on Singapore finances.
“Singapore has become one of the most indebted countries in the world. According to recent IMF data, when taking a moving average of the 2008-2011 period, Singapore is the 13th most publicly indebted country in the world relative to GDP. Singapore has a higher debt to GDP than Iceland, Ireland, Portugal and Belgium and is only a little behind Iraq and Italy,” he wrote.
Professor Balding added that what makes this level of indebtedness even more concerning is that Singapore has managed to accumulate such high levels of debt while supposedly running constant surpluses.
“Singapore is the only country to have managed to average a surplus fiscal position and increase its overall indebtedness to nearly 100% of GDP. All other countries with high levels of debt such as the United States and western Europe, have long term public finance deficits which adds to total public indebtedness. There appears no valid reason for a country to incur large and sustained public surpluses and increase their total public indebtedness to such high levels.”
Read Prof Balding’s article in full here.