Did LKY try to hoodwink CPF members with misleading GIC long-term rates of return?

There are lots of contradictions with the disclosure of information by PAP-affiliated entities, including Lee Kuan Yew, former 30-year chairman of GIC.

In a keynote address at GIC 25th anniversary dinner, LKY boasted: “Over a period of 25 years to March 2006, the annual rate of return on the foreign reserves managed by GIC averaged 9.5% in US dollar terms, and 8.2% in Singapore dollar terms.”

Many were impressed but these numbers are of course unverifiable.

In 1984, LKY disclosed CPF balances were $12.15 billion. Since CPF was managed by GIC, the initial investment would have ballooned to $87.15 billion in 2006 at 8.2% SGD annual rate of return. Calculator
If subsequently invested at only 4% rate of return, $87.15 billion would have increased to $129 billion in 2016.

But of course the government is unable to show us the money. 🙂

If our coffers were overflowing with tens of billions from a single long-term investment, why is poverty evident in every corner of our little red dot?

In 2011, LKY brought more good news to Singaporeans, as if GIC was not impacted by the global financial crisis only a few years earlier: GIC earned a 30-year rate of return of 10.2% in USD.
​This was of course, again, unverifiable but PAP did not have to fear telling half truths because even such a preposterous claim would not have been challenged in Parliament, even by opposition MPs.

LKY could have also disclosed the rate of return in SGD because returns would have to be converted to supplement government budget or for interest payments to CPF members.

It appears the difference between USD and SGD rates of return was huge and LKY would rather exaggerate to impress CPF members.

Using the same $12.15 billion CPF balances at inception, the returns are computed in the table below.

USD return = 1840% vs SGD return = 1040%.
No wonder LKY chose the former because US$ had lost about 40% of its value against S$.
If land revenue were included since inception, GIC should be managing at least $1 trillion in assets after 35 years. Is it?

All these return claims by LKY are absolutely unbelievable. Are the combined assets of MAS, Temasek and GIC even close to $1 trillion? 🙂 🙂

Hmm .. was LKY trying to hoodwink or maybe instilling some confidence in gullible CPF members?

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