His statement, however, will do more harm than good in Thailand where doubts about Singaporean investment are on the rise and the public seeks sincerity in any explanation of the deal.

Looking forward, the Singaporean government would certainly run into more difficulties in expanding its presence here, if the Bt73-billion Temasek-Shin deal is not satisfactorily explained by the city-state, regardless of the final ruling on whether Temasek had breached foreign shareholding limits in the purchase and how this would be cured.

"The press, Moody's, etc are curious to know. We disclose what we think they need to know. This is our money, we are trustees, we know what we have to do and we're going to do this," the Financial Times recently quoted Singapore's elder statesman as saying when asked about the Temasek-Shin deal.

Temasek was criticised for failing to conduct proper due diligence of Shin Corp, while the Singaporean government has recently been asked by its parliament to explain the deal. If Temasek is forced to sell its shares in Shin Corp to reduce its stake to 49 per cent from the current 96.29-per-cent level in order to avoid breaching the foreign limit, it is expected to realise a loss of up to Bt25 billion, as Shin stock has fallen much lower than the Bt49.25 per share that Temasek paid.

The Financial Times also quoted Lee as saying the Temasek-Shin deal was "completely above board" and the purchase was conducted in accordance with Temasek's strict internal rules. He said that, to the outside world, the internal working systems of Temasek and Government Investment Corporation of Singapore (GIC) are necessarily hidden.

"But we have reasons for that. Some we're prepared to disclose, some we're not," he said.

In case of the Temasek-Shin deal, financial secrecy was understandable when the deal was still under way and negotiations were still not concluded. But when the deal was completed, it left taxpayers here with a number of questions, only half of which have been answered so far.

Many still wonder whether Temasek had made side agreements with former prime minister Thaksin Shinawatra on the deal, which involves state concessions for a TV station, satellite operator and the biggest mobile-phone service provider.

Most importantly for the Singaporean government, sincerity has become the biggest issue. Lee Hsien Loong, the prime minister of Singapore and also the son of Lee Kuan Yew, told reporters shortly after the deal was done on January 23 that it was purely a business transaction by the private sector and had nothing to do with his government. However, he raised the matter with his Thai counterpart Surayud Chulanont during the recent Asean summit in China, in stark contrast to his earlier stance.

Asiasentinel.com recently said the rulers in undemocratic Singapore - so used to not being challenged by the public or the media - seem never to have stopped to think that the acquisition might cause problems. Perhaps they were overly impressed by Thaksin's attempts to impose the Lee Kuan Yew/Mahathir (Mohamad, former Malaysian premier) style of leadership on his people and his expectation that he, like they, would be in power for many years, the online media site said.

Given Temasek and GIC's investment history - while these investment arms of the Singaporean government have been recognised by Europe and America for their growth-oriented strategy and model of efficiency - Southeast Asia does not trust them that much. With the Temasek-Shin scandal, whatever trust there was has nearly evaporated. The Singaporean government would find it harder to pursue the city-state's mission of "Singapore Unlimited" to build up its external economy in the region.

While gradual legal actions have been implemented to correct what went wrong with the deal - including the probe into whether Temasek broke foreign ownership laws and the move by the Revenue Department to make Thaksin's children pay up taxes on the deal - it may take a long while for Singaporean investors to regain the trust of the people in the countries they enter.

As the old saying goes, a city is not built from money but from trust and faith.

Jiwamol Kanoksilp

The Nation