The Singapore Commentator

Basskaran Nair thinks that Singaporeans’ problems in handling their SingTel shares is the result of poor communication by government officials. Excerpt from his commentary in The Straits Times:

Never a people to miss a good bargain, Singaporeans formed long queues, back in 1993, to buy new SingTel shares at a deep discount. Today, there are still queues — but this time, it is to sell those SingTel shares, plus some, given to them for having held on to their shares over several years....But that’s not the worst of it. What’s most disheartening are the faces in the snaking queues. They’re the same as those in 1993: The “ah peks” and “ah sohs” who are invariably more than 55 years old, do not speak English and are crippled by anxiety over opening a trading account with a stockbroking firm....

How did all these queues arise, and why are they still occurring, 11 years after SingTel shares were first offered? The answer lies in communication, or rather the lack of it.

[T]he Government decided in 1993 to create a shareholding society... Officials from SingTel and several government ministries worked overtime to iron out the details in the dual-track mission: to sell SingTel shares at a discount to Singaporeans, and to develop the social contract through the shareholder society. But, focused on the intricacies of floating a billion-dollar company and creating a shareholder society, the planners failed in one vital area: Effective communication...

The inevitable happened. From the word “go”, communication was found wanting. First, communication with the media. The planners might have recognised that the media would be a vital conduit for the message, but they didn’t prepare it in advance for the momentous float. Only one press statement was issued... Second, communication with the man in the street. Planners forgot about the nitty gritty that the ah peks and ah sohs would encounter when buying the shares, and later, selling them...

While I don’t disagree with Basskaran’s analysis, his is not exactly the way I would have framed the problem.

Basskaran says that the media was a vital conduit for communication. But in fact, many Singaporeans don’t pay much attention to the media. This problem is not necessarily restricted to the ah peks and ah sohs. Many relatively educated Singaporeans also don’t pay much attention to the news, apart from possibly those on their favourite movie stars or singers.

Even if communication could reach them, there would be many Singaporeans who would have trouble understanding everything involved in owning shares — exactly what it means to own shares, how to value them, when to sell, and how to transact in them.

So effective communication was always going to be a problem. That, in fact, should have been the starting assumption. That would have led to the question of whether the concept of share-ownership for everyone is viable in the first place.