President, Secretary General, fellow delegates, greetings from the cultural melting pot that is Singapore.

My country has the ninth (9th) best Debt to GDP Ratio in the world while on the other hand we have been operating on a surplus budget for at least the last two decades. I am very sure this declaration has a puzzling effect on my fellow delegates as the situation I am here to present to you today is a dichotomous one. This is as we have managed to engineer ourselves into this position of extreme contrasting perceptions; as a high Debt to GDP Ratio is associated with poverty and squalor while a surplus budget brings to mind images of prosperity, an utopian like society. To be frank, my country is in neither of these states. Our economy is stable, not perfect, as nothing in this world is. Nevertheless I strongly believe that the Great Port country of Singapore comes close to it that is perfection as our economy is stable, our citizens are skilled, well educated and are able to thrive on the global market.

The mechanisms which resulted in our current situation can be traced back to almost fifty (50) years ago when we had separated from Malaysia. At this time, my country was in a penurious state. Poverty was high along with unemployment and the economy was based on low end commerce which only provided for domestic use. We had no physical resources to speak of and our only natural resources, the people, were under developed.

Given this predicament, our purpose was now to create an environment that would be conducive to economic growth. To achieve this goal, we had to borrow the initial capital stock from foreign creditors to fund government expenditure. Had we continued to borrow from these creditors we like most countries- would eventually rack up a deficit. However, through proper management we were able to transform the country from a third world, disadvantaged nation to a now modern, global, first world financial center.

This state of economic well being was not achieved by simply implementing the same policies that have been tried, proven or discarded by other economies. We were bold - we still are - and we dared to be different and innovative, developing a unique Singaporean model which resulted in us owing basically no capital to external debtors today. Our success in the management of our debt comes from our strict but rather ingenious government policies implemented by strong, creative leaders. This string of pioneering leadership commenced in 1965, when we first started to accumulate larger amounts of external debt. This capital that was borrowed was invested wisely and resulted in the economy growing by leaps and bounds. This was because the capital was used to develop the physical infrastructure of the country. This included the construction of industrial parks, areas where factories with common purposes were built together, thus resources could be effectively shared and therefore be conserved allowing our manufacturing industry to flourish. Improvements were also made to communication networks. Our citizens were trained at every educational level with the skill set that would be necessary in the production of what we wanted to make, use and

export. Furthermore to facilitate the growth of industry in our country, a Manpower and Training Unit was formed. This program's aim was to further develop the skills of our fellow nationals. A main feature of this program was an overseas training program where Singaporeans had the opportunity to work as apprentices, experiencing and exchanging knowledge and skills in Germany, Holland or India. We acknowledge and recognize that their help was an instrumental contributing factor to our success and we now intend to extend open and welcome arms to other countries so we can work hand in hand to facilitate the economic growth of less fortunate countries thereby contributing to the establishment of more equity in the trading world. Singapore also has one of the best logistics education systems and we fully intend to play our part in mitigating worldwide debt by offering these educational services to other countries so they can utilise these skills in improving their local economy and thus the global economy.

Additionally, we formed the Singapore Economic Development Board (EDB). This organisation had a budget of 100 million dollars and its purpose was to procure foreign investments. We therefore laboured to create a secure environment as we knew without this, investors' confidence would be nonexistent and we would be incapable of convincing them to do business in Singapore. The success of these initial measures resulted in tremendous economic growth of an average of 8% per year up to the early 1980s along with a surplus budget as our foreign debt was basically paid off. In order to keep this new found stability, other policies were put in place to protect our state's pool reserves. These included for one, the government turned to taxation rather than foreign creditors to fund its expenditure. Secondly, entrenched in our constitution is the Protection of Reserves Framework. In this document it is stipulated that only the reserves accumulated during each term of government can be spent. This policy in particular ensures that our fiscal position will not be easily eroded through mismanagement. We therefore recommend that representatives of various countries lobby for the regulation of current government as it may be crucial in securing the success of your economy for years to come. Singaporeans are also an instrumental part of our debt management efforts. The people were incorporated through an online forum, Credit Counseling Singapore, which was launched to assist and counsel regular citizens on effective debt management. This was aimed at strengthening debt management on the individual level which inherently contributes to our ability to successfully monitor debt on the national level.

So far I have accounted for how we were able to achieve our national surplus budget. The other half of the dichotomy is our Debt to GDP Ratio. As stated earlier, our country does not owe any significant amount of foreign debt rather the large debt that we have accumulated is in the form of government issued bonds that are issued domestically. These bonds are issued for the purpose of affording the Central Provident Fund (CPF) an avenue for investment purposes and for growing the debt market in my country.

The CPF is a strict pension scheme in my country in which a quarter of every citizen's income is contributed to. Our government does not own this fund, rather it is the property of the people and is run by an appointed board. In order for our government to have access to these funds for various welfare projects, we have to issue "borrowed" capital from the fund. We issue special government bonds to the CPF which returns an interest. The main project which our government uses the CPF capital to fund is our Housing Development Program. This program started back in the 1970s with the purpose of providing a form of housing for every Singaporean. Our government would build houses and apartments and these would then be sold to the people at a rate dependent on their income. This program was successful to the point that the initial housing first provided in the program is now being expanded to ensure that the quality of housing is suitable to everyone's needs. Once again my country is prudent in the management of debt as this program is strictly managed and I can proudly declare that we have never been plagued by an over run of expenditure in this project. Furthermore the interest that we may accumulate is added to the country's pooled national reserves and the principal has to be repaid to the fund.

The domestic debt market in my country initially was developed as a response to the needs of the financial institutions that wanted a risk free asset to be included in their liquid assets portfolio. The need to grow the debt market occurred in the late 1990s after the Asian financial crisis made us realise that we needed to diversify the sources from which we obtain capital as banks alone can be risky. This led to a ten-fold expansion of the domestic debt market in which a significant amount of bonds were issued from 1998 to 2010 to facilitate the growth of the market by encouraging trading of the bonds. Furthermore, these bonds were issued on the basis of encouraging foreign along with local participation in our debt market. This move on the part of the government to expand the debt market resulted in the growth of the financial sector which is now the third largest contributor to our GDP. As a recurring theme in my country, restrictions were recently placed on these bonds. The government approved a debt ceiling last year stipulating the amount of bonds that can be borrowed by the government for use. I am confident that this law will go a long way in ensuring that our domestic debt is controlled and will not hinder our economic stability but rather add to the overall advancement of the country as it has been doing for over a decade now.

In light of the situation described above it can be seen that debt coupled with efficient and creative management can lead to macro-management policies with regards to debt control while still maintaining a very open and liberal economy. This goes to illustrate that the two models can coexist as a country can have high levels of economic freedom without leaving the market totally

unregulated. Each country should endeavour to find and maintain the delicate balance between control and freedom as my country has, in order for them to curve their debt and grow the economy simultaneously. I believe my country's innovativeness in debt control might just be our greatest contribution to resolving the debt crisis as we have provided a successful, working model of balancing seemingly opposite situations to foster growth and this is a model worth emulating. There were no success stories for us to base our economic model on, we took a risk well calculated - but a risk nonetheless. I therefore urge my fellow delegates to follow in our stead and think outside the box. Yes, it can be beneficial to follow the tried and proven methods but it can also be beneficial to think differently and my country stands as testament to this.

On behalf of my country and the Singaporean people, I thank you for your time today.