SINGAPORE May 9 The Government of Singapore
Investment Corp (GIC) has achieved returns comparable to
equities since its inception 30 years ago, but with less risk,
Chairman Lee Kuan Yew said on Monday.
"Compared with the popular high-return asset class of
equities, which returned 10.2 percent per annum in U.S. dollar
terms since 1981, the GIC portfolio made comparable returns with
lesser risk, Lee said at a dinner to mark the sovereign wealth
fund's 30th anniversary.
He added the returns outpaced global inflation by a
"The next 30 years looks challenging (and) the investment
outlook could be less benign," said Lee, Singapore's first prime
minister and the father of current Prime Minister Lee Hsien
GIC, one of the world's largest sovereign wealth fund,
manages around $300 billion. Its investments include stakes in
UBS and Citigroup , which it helped rescue in the
aftermath of the financial crisis.
GIC said in September last year it managed an average return
of 7.1 percent a year in U.S. dollar terms in the 20 years to
March 2010, up from 5.7 percent per annum for the two decades
ended March 2009.
Lee said the global economic environment appeared "unusually
"It will take time to work through the full consequences of
the crisis, such as the huge amount of debt the developed world
has taken on," Lee said, adding the turmoil in the Middle East
has elevated geopolitical risks.
Lee said GIC must be prepared to take decisions that may
appear unconventional to perform better than its peers.
"As GIC grows larger and more established, the impetus to
follow conventional practices will grow stronger. This could
lead to mediocrity."
(Reporting by Kevin Lim and Saeed Azhar)