Written reply to PQ on Deployment of Private Credit Growth Fund Given Rising Global Private-Credit Risks

Question

Mr Kenneth Tiong Boon Kiat: To ask the Deputy Prime Minister and Minister for Trade and Industry (a) whether the deployment of the Private Credit Growth Fund will be pulled back given rising global private-credit risks; and (b) whether GIC’s caution on the private-credit market will inform the Ministry’s stance on the deployment of the Fund, or are the views separately held.

Written Answer by Deputy Prime Minister and Minister for Trade and Industry Gan Kim Yong:

1.       GIC’s caution reflects its commercial assessment of the (global) private credit market, which has grown significantly in the US and to a lesser extent in Europe. However, aside from Australia and Korea, the private credit market in our region is much less matured. The Private Credit Growth Fund (PCGF) was thus established to support the strategies of high-growth Singapore enterprises which require tailored financing solutions beyond what traditional debt or equity instruments can offer. Enterprise Singapore will work with the appointed fund manager to ensure that investments made are in line with the fund’s developmental objectives.

2.       The appointed fund manager for PCGF will exercise independent commercial discretion to assess the merits of a deal, including prevailing market conditions as well as the risk-reward profile of each opportunity, to determine the appropriate pace and level of capital deployment.