Good evening, Mr Hank Paulson

Distinguished guests

Ladies and gentlemen

I am very glad to be here today at the official opening of Goldman Sachs Singapore’s new premises.

These are challenging times for the global financial services industry. Globalisation and technology are advancing apace. The recent wave of mergers and acquisitions shows that the major changes of the last few years are far from over.

Goldman Sachs is one financial institution that has successfully organised its resources to tap opportunities around the world. From its beginnings as a privately-owned US investment bank, the Goldman Sachs Group has grown into one of the largest financial services groups in the world, present in all major financial markets.

In Singapore, Goldman Sach’s operations have grown substantially since its establishment in 1989. Singapore is responsible for Goldman Sach’s investment banking activities in ASEAN as well as India. Your asset management operations have also grown significantly to comprise a full-service fund management outfit comprising 28 staff. Singapore is the ex-Japan hub for fund management. The Singapore team is responsible for managing Goldman Sach’s Asia ex-Japan equity mandates as well as the Asia ex-Japan components of broader mandates. Singapore is also responsible for the business development and client servicing activities for the Asset Management Group’s product range in the region.

In recognition of these commitments, I am pleased to announce the award of the Enhanced Fund Manager status to Goldman Sachs (Singapore) Pte. The Enhanced Fund Manager status will exempt from tax Goldman Sachs’ fee income received from managing funds of foreign investors. With this award, Goldman Sachs joins a select group of fund managers with the Enhanced Fund Manager status, who all manage more than S$5 billion of foreign investors’ funds in Singapore.

Moving ahead, the government must ensure that Singapore has the most efficient infrastructure and modern facilities to cater to the need of businesses. We start from a strong base. Our strategic location within Asia and comprehensive air links means that other Asian destinations are at most a 7-hour plane trip away. Our telecommunications infrastructure is just as extensive. After the full liberalisation of the telecommunications sector in April, the industry is growing dramatically. Telecom charges have already declined sharply, and will undoubtedly fall further.

For the financial sector, one unique infrastructural requirement is buildings with large floor plates, so that the institutions can have large column-free spaces for their dealing rooms. Technology and changing investor preferences have made large areas for pit trading in Exchanges obsolete. But financial institutions still prefer to house their various risk-taking units in large dealing rooms.

The growth of the financial sector has created an acute shortage of buildings with large floor plates in Singapore. One Raffles Link, where we now are, currently boasts the largest available floor plate in the financial district – 5,000 square metres. In November, the government will be releasing a new site – a large white site in the New Downtown at Marina South. This will have a maximum floor plate of approximately 9,500 square metres, almost twice the size of One Raffles Link. The total area that can be developed at the Marina South site will be about 150,000 square metres. With the success of One Raffles Link, we hope that the developers will bid for the Marina South site to put up a large floor plate building, to meet the needs of financial institutions, and provide them the capacity and facilities that they urgently need.

The Urban Redevelopment Authority, in its current review of the Concept Plan, has set up two focus groups which will give feedback to the Government on the land needs of the various sectors of the economy and population. MAS has nominated players in the financial sector to participate in the focus groups, to give their inputs on the needs of the financial sector.

Beyond physical infrastructure, we will also build on our regulatory framework to keep it attuned to global best practice, and ensure that it fosters innovation in the industry. We have been in close dialogue with the private sector as we strive to keep our financial sector abreast of developments. We will continue to partner the industry to make Singapore a vibrant location of choice for key global players such Goldman Sachs.

In closing, let me once again congratulate the management and staff of Goldman Sachs on the opening of your new premises. I hope that the added capacity in your new premises here at One Raffles Link will allow you even more opportunities for further growth in the new millennium.

I wish you every success for the future.

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