Photo of Lee Hsien Loong from Facebook

Till date, Prime Minister Lee Hsien Loong is keeping secret of the total budget for Terminal 5 because a huge component of the new airport is land sales. According to Transport Minister Khaw Boon Wan’s speech last Friday (Aug 3), Terminal 5 will take up 1,080 hectares of reclaimed land in Changi East – the size of Tampines town or 2.5 times of Marina Bay. A sanity check however easily revealed the minimum cost of Terminal 5.

Based on the residential square meter rate of S$1,500 per square meter, the 1,080 hectares of land would cost no less than S$15 billion in commercial value – had the newly-reclaimed land being properly valued by an assessor that is. As dictator Prime Minister, Lee Hsien Loong could convert land value to zero cost to the government as he wish, but he would lose the opportunity to cover the losses he incurred at GIC.

All land sales revenue are handed over to the GIC, where dictator Prime Minister Lee Hsien Loong sits as Chairman. In recent years, GIC has been posting record losses, that saw its 20-year-return-average falling from 4.1% in 2014 to today’s 3.2%. In absolute terms, GIC lost more than S$40 billion in the past four years to significantly affect the 20-year rolling return.

Henceforth Lee Hsien Loong’s choice has been obvious: burden the country with debt and rising taxes i.e. GST 9%, to fund Terminal 5’s inflated land price in order to cover his losses at GIC.

On top of the S$15 billion in land costs, Terminal 5 would require a further minimum of S$15 billion to construct its airport facilities and infrastructure. Comparing with Project Jewel, Terminal 5 should hence cost no less than S$30 billion in total.

Based off Minister Ng Chee Meng’s previous statement and other public release from the government, Terminal 5 is currently funded as follow:

1) S$9 billion from government taxes (mostly land costs, which the corrupted government could write away and transfer taxes into GIC without public approval), this amount will increase to S$15 billion (land costs) as other tax increases are funnelled into Terminal 5

2) S$3.6 billion from Changi Airport Group

3) S$1 billion to be funded from new airport taxes

4) S$10.4 billion shortfall to be funded from a mix of government debt and CAG