The Straits Times Blogs - Jessica Cheam

Life on Myanmar's biofuels plantations

2008-12-10T07:42:00Z

Jessica Cheam shares her insight on Myanmar's sunrise biofuels industry.

AS A clean energy reporter, I often write about new developments in technologies such as solar and biofuels, but seldom get the chance to get up close and personal with the actual process.

But just a couple of months back, I was given the opportunity to get my hands dirty, literally, when I was invited to visit a jatropha plantation in - Myanmar.

It couldn't have been a more unlikely destination, and it almost didn't happen because of cyclone Nargis. But fortunately, the damage done to the plantation was reparable and I finally made it to Myanmar where for the first time, where I could touch the plant, seeds, fruits, that I often wrote about. And spoke to the people who made it happen.

So let me give you the context of my visit: Biofuels is an industry that is both full of promise and controversy.

Singapore has a number of biofuels refineries itself, and the EDB has singled the sector as one of the key renewable energy areas important to Singapore's economy.

But on one hand, while biofuels is a key player in the world's future energy mix - one that is renewable and can make our transport fuels cleaner, its development can also lead to deforestation as it competes with food crops for arable land if not managed sustainably.

Amidst this raging debate on the sustainability of biofuels, a second generation of feedstock has emerged - one that uses non-food crops. The jatropha plant, algae, wood mass from plant waste have been singled out as some promising "fuels of the future" as they don't compete with food and can grow in hardy conditions or exist abundantly in other locations.

In Asia, many countries have particularly caught on the jatropha "fever", with China, Indonesia, Malaysia, Cambodia, and Myanmar planting its seed extensively in the hope of riding on the wave of this sunrise industry.

But these feedstocks are also not without its risks. Most are relatively under-researched, and no one knows if full-scale commercial applications of using such feedstocks to make biofuel will be successful yet.

So it is with all these considerations that I went with my eyes wide open to visit the 100,000 acre estate at Maw Tin, in south Myanmar, to get a better understanding of how the industry and this particular feedstock works.

And my experience did not disappoint.

I was happy to learn that biofuels can be cultivated sustainably and responsibly if planned for, right at the beginning.

The plantation was eco-friendly and completely self-sufficient. It had the hallmarks of Singaporean planning and efficiency, if I might say so. And not surprisingly, it had a Singapore connection.

The plantation is the work of Singapore-listed firm Yoma Strategic Holdings, which has a unit, Plantation Resources, which manages and sells produce from this estate in partnership with a local Myanmese firm called Myanmar Agri-Tech.

The plantation has a 650-strong community, mostly local farmers, who go about planting the seeds, harvesting them, sorting the seeds out, and then re-planting them again. When I spoke to Myanmese farm worker Thin Thin Khing, she tells me of her days in the fields.

Six days a week, working from 6.30am to 11am, then 1 to 4pm. Days off for the 29-year-old are spent relaxing with her co-workers in Pathein city, less than half an hour away. She's worked on the farm for more than a year now.

Before this, she says, she had never worked before, and was mainly doing housework for her family. Now, she earns about US$45 (54,000 kyat - the local currency pronounced like "chut") a month - above the national average of US$30.

Breakfast, lunch and dinner are provided on the farm, prepared by cooks who live on the plantation. Their food is also produced on the estate, where beans, rice, vegetables and even domestic animals such as goats and pigs are reared for consumption.

Power for the plantation comes from burning biomass (rice husks) and water is pumped from underground, making the entire plantation almost carbon neutral, save for the diesel used to power vehicles. I even spotted the kids of the farmers riding a baby elephant, which they had tamed from the wild, now used to do menial physical work on the plantation.

I visited the workers' quarters and the kampong-like huts where children and parents of the plantation workers - three generations of a family - were living together in a cosy village setting. It was all very "harmonious" living - nature, wild life, and humans, all on this plantation.

I was impressed to see the degree of planning involved in the plantation, especially how the way it was run sharply contrasted the reports from NGOs that have surfaced on how the Myanmar government's jatropha drive has backfired on itself.

Organisations such as the Ethnic Community Development Forum allege that Myanmar's junta have used forced labour or confiscated land in some locations. And has directed the entire nation of farmers to plant jatropha wherever they can, without fully understanding the climatic conditions needed to cultivate the plant successfully.

Chief executive of Myanmar Agri-Tech, Mr Frankie Tan, who oversees all of Yoma's plantations, notes that the junta’s drive has got “good intentions” but lacks a clear roadmap. Farmers are told to plant the seeds, but there is no system to collect them, and also – no refinery to convert the seeds into refined biodiesel.

This is where Yoma's chief executive Serge Pun, a Myanmar-born tycoon who made his fortune in real estate developments across Asia, wants to play a part.

He told me that he hoped Yoma's farm would be a model example for the rest of the country to follow.

When sourcing land for the plantation, Mr Pun gave strict instructions not to use arable land meant for food. The whole estate was also designed to be self-sufficient, it has an office on site and workers’ quarters for the farmers and their families. It's important for the firm to “do things right and sustainably” if it wanted to be a long-term player in the jatropha market, he said.

And now, Yoma is expanding by implementing a contract farming strategy which will make it the biggest jatropha seed collector in Myanmar. This will possibly salvage the current situation in Myanmar where farmers are stuck with jatropha seeds, but no buyers.

And there's more in the pipeline. Yoma is planning to build a biodiesel refinery in partnership with a major Korean biofuels supplier, Enertech. It will be three miles from Maw Tin, along the Yangon River, and will facilitate both domestic use and export of the biofuel - something that might save Myanmar from spending millions of its foreign reserves on fuel imports ( a top reason why Myanmar's government have embraced jatropha in such a big way). Mr Pun, who has been doing business in Myanmar for 18 years, is bullish about jatropha’s prospects, despite its critics - which is why Yoma has pumped in US$6 million into their jatropha operations in the country so far.

And from what I saw, I'm convinced biofuels can be a sustainable business if done right. The challenge is putting the regulations and/or private sector initiatives in place such that this can be ensured.

When this is achieved, a true win-win situation will benefit all parties involved - and the environment. We'll have a world with fuels that are cleaner, companies that can make a profit supplying it, and a nation of farmers who might find that a seed could be their ticket out of poverty.

On the hunt for illegal tenants

2008-10-07T13:31:00Z

Jessica Cheam wonders if shortage of cheap housing is the root of the problem.

IT was after repeated knocks on a door went unanswered that HDB officers were about to give up. The window shutters and doors were firmly shut, yet bright lights and faint noises from within the flat was betraying the tenant's presence.

Just as the HDB team was about to walk away, the door opened and a young girl of 15 emerged. HDB officers started quizzing her: Who are you, what's your name, how long have you lived here, who do you live with.

She looked terrified, but she answered all the questions behind the locked grilles separating her from us: I've been here for only a week, I'm staying with a female "parent's friend".

One HDB officer (let's call him Mr Tan) looked at me and whispered, "this flat is rented to a man born in the 1930s!"

A laptop, books and personal items litter the two-room flat, suggesting the occupant - a secondary three student from Thailand - is the sole tenant of the flat. She later revealed she paid $1,000 a month to live there. PHOTO: HDB

Caption: A 'Notice to Quit' letter is pasted on the two-room flat's door the next day, for the tenant to contact HDB and to evict the flat within one month. PHOTO: HDB

It was obvious at that moment that our inspection had uncovered a case of illegal subletting, which was recently reported to be on the rise.

This was the moment I had been waiting for, the climax of the "enforcement blitz" which we carried out at Circuit Road last week. But somehow, I had imagined a more dramatic unfolding of events, perhaps with officers loudly knocking on doors, demanding to be let in, "guns" ablazing. Illegal tenants confessing. Maybe even crying. And with lengthy interrogation techniques deployed by officers required to induce the truth.

In reality, the whole episode was more sobering than dramatic.

I realised, it was important for the HDB officers to be un-dramatic, in fact. They had to appear normal, routine even, so as to be unconfrontational, to gather the evidence and information they needed from the illegal tenants.

In the case of this girl, Mr Tan had to repeatedly assure her it was a "routine HDB inspection" and that he only had a few questions. He requested to see her IC, and it revealed she was a Secondary Three student from Thailand attending a school located nearby. After getting no answers as to who her "parent's friend" was, Mr Tan requested that the girl unlock the gates for the officers to "take a look".

The girl hesitated, unsurprisingly. There were about 10 of us on this "mission" which no doubt was intimidating.

Then she relented and unlocked the gates. Three officers entered, and promptly started taking notes and photographs with their flashing digital cameras.

At this point, the girl looked increasingly worried.

I went into the flat myself, and looked around while Mr Tan pointed out the evidence in the flat: only one bed. Young female clothing, books, and bags strewn all over the place. No sign of any man or woman living there.

It was when Mr Tan told her that he needed a statement from her, with her signature, that the girl caved in and confessed that she lied about staying there for a week. She revealed to gasps all round that she paid $1,000 a month to live at the flat - which the HDB officers told me was rented out for only $44 to the 70-year-old man.

The poor girl was obviously ignorant of the rules of the game. At one point, Mr Tan even gently asked her, "Do you know what's the HDB?"

He had to explain what the Housing Board was, and how the flat belonged to them and was rented out to Singaporeans. All the while, he kept reassuring her that she wasn't in trouble, although she looked stricken with anxiety.

Having been so compliant so far, the girl flatly refused to give Mr Tan the contact number of the "woman" who was her "parent's friend" who rented her the flat. She wouldn't say either, if the woman was an estate agent. After asking more questions, and taking down her number, Mr Tan finally thanked her and we all left, ending her traumatic experience of having 10 strangers descend into her flat.

And as we left, I realised how different the episode had been to what I'd expected.

Five months ago, I had staked out a rental block in Toa Payoh every night for a whole week, hoping to catch glimpses of foreign workers entering or departing from their illegally rented HDB flat for my story. I had heard, on several occasions, loud voices with strong foreign accents in dialogue in a brightly-lit flat, with its windows and door firmly shut. Interviews with residents had revealed then that the profile of the illegal tenant was the average foreigner worker from Malaysia, China or India, looking for a cheap place to rent. I had expected more drama from these types as HDB officers tried to catch them out on their illegal tenant status.

But what we uncovered was an unknowing foreign student, who now has to hunt for another place to live, while having to juggle her studies at the same time. I genuinely felt sorry for her.

It really brought home to me that the underlying reason why illegal subletting is on the rise in the first place is this: the shortage of cheap accommodation for the huge influx of foreigners coming into Singapore seeking a better life, whether to join the workforce or to further their studies.

True, the Singaporeans who rented out their units in the first place are primarily to blame. But it's easy to see how the tempation of getting an extra 900 bucks cash-in-hand from renting a flat out is difficult to resist, especially if that is the price that can be fetched in the current market.

While the HDB is stepping up its checks to clamp down such abuse, the sheer number of flats - some 42,000 currently - makes it difficult to ensure that none of this illegal subletting is happening.

It also suggests that perhaps the private sector is unable to provide enough supply of cheap units for such foreign workers to live. If the Government means business about reserving our very limited rental flats to the truly needy, it could do well by looking into the private rental market to ensure enough supply can be provided for the foreigners living in Singapore.

Otherwise, HDB's inspections can only solve the problem superficially. And the next tenant that moves in might just get tempted to make a quick buck again.

Can a green F1 ever exist?

2008-09-29T06:33:00Z

Jessica Cheam says if the F1 is here to stay, let's look at making it greener.

FOR the first time in my life, I watched an entire Formula One (F1) race from start till finish. It was a remarkable feat, considering I'm not a massive fan and have always regarded the F1 sport somewhat as glorified traffic.

But as much as I am reluctant to say it, I did feel a surge of pride watching the cars race through the world's first night-time street circuit, our city skyline brilliantly lit as a stunning backdrop to a really dramatic race.

Who would have thought Ferrari's Massa who started first would end up in the lowest rankings, while Renault's Alonso who started in 15th position would emerge champion of the historic night race.

But gripping as the race was - with three car crashes, two safety car episodes and a barrage of pit-stop blunders to hold my gaze for close to two hours - I started to contemplate the irony of the event, (here to stay for the next four years at least) and how it holds against Singapore's ambition to become a leader in environmental sustainability.

With the F1, there's no doubt that the environment takes a backseat. Online forums reveal disgruntled citizens not too happy with this hypocrisy, since there is no reconciling gas-guzzling cars with reduction of greenhouse gases. One blogger even wrote, "When it comes to F1... there is no swell of pride... all I feel is a swell of nausea".

Which made me think: what exactly is the carbon footprint of the Grand Prix? Is it even possible to calculate it?

Each of the F1 car consumes up to a litre of fuel per kilometre - and for every km, it spews 1.5 kg of carbon dioxide emissions - largely regarded as the culprit for global warming. So twenty cars at about 305 km each for the entire race, translates to about 9,150 kg of emissions.

On top of car emissions, each F1 team operates more than 30 tonnes of equipment which again consumes copious amounts of energy to transport to the site.

And let's not forget the lights that garnered so much praise for the Singapore Grand Prix organisers - with 108,423m of power cables, 240 steel pylons, approximately 1,600 light projectors, a staggering 3,180,000 watts is used.

If you consider the hundreds of thousands of tourists who flew in for the event, the total carbon footprint of the event is even more mind-boggling.

Yet in the midst of all this seemingly indulgent energy-busting event, there were some comforting signs that signalled that the F1 sport in the coming years might get greener.

Firstly, there was the Singapore Freeport skylounge at the Fullerton Hotel, which built a solar canopy to offset half the energy it used to entertain some 250 guests in its suites. It might pale in comparison to the total footprint of the event, but at least it was a step taken in the right direction. The firm has also promised to donate the installation, worth more than $100,000, to a local school in Singapore.

Car-maker Honda, also stood out for its cars being the only ones not drowned by sponsor logos. Forgoing millions of dollars in sponsorship deals, Honda had artwork on its cars depicting the planet earth, as part of a strategy to give the sport "a more relevant and ethical image".

Nick Fry, the Honda team principal, had said that the sport "has to change or it will wither on the vine and become extinct - just like the dinosaurs".

Intrigued by the green credentials of the sport - a under-reported aspect of the event, even at this newspaper - I went and looked up what the F1 was doing to make itself relevant in today's context of global warming.

After all, I think it's unrealistic to think the sport will be stopped altogether, after decades of tradition and with a massive global cult-following.

Besides, we should realise that innovations made in the sport gets passed down to the average consumer vehicle in making it more energy efficient. Not to mention, there are the arguments that the event will boost the country's economy, its tourism and its image, leading to investment opportunities with countries all over the world.

So if the F1 is here to stay, then let's look at how it can be improved.

And there's some good news: the sport is changing. It will get greener, simply because it has to.

Formula One's governing body, the International Automobile Federation (FIA), has been reported to want the sport to cast off its gas-guzzling image. It has proposed rule changes for 2011 that include, for example, a switch to smaller turbo-compounded 2.2 litre engines running on biofuel.

Another rule would require cars to have a 25kg device to store brake energy to use when accelerating. Also planned are limits on the number of staff teams can take to races and on wind tunnels, which use vast amounts of electricity.

Such modified rules of the game could lead to technological advancements that cater specifically to making transport in everyday-life more efficient. And the sport could also do well with more marketing on its impending "green" changes.

Needless to say, some F1 bosses are not too happy with the environmental concerns pressurising the sport. One head honcho, who has vocally said this isn't a priority, even came up with a lame defence that "the millions of people watching F1 races on television are thus not using their cars while the race is under way".

The way I see it, he will soon be a lone voice protesting against a very real tide of change. The sport cannot continue to enjoy its popularity if it doesn't address the environmental concerns surrounding it.

Meanwhile, all eyes will be on whether the FIA will do what it says. And in Singapore's case, when the novelty of the first night-race wears off next year and it has to up its game, the country could do well by distinguishing itself from other destimations if it engineered a much more environmentally-friendly event.

That, I think, is a sure-win strategy to stay ahead in the game. Not to mention, it will help to keep its own citizens happy and proud hosts of the F1 sport.

I mean, I might even watch the entire race from beginning till end when it comes around next year again.

CEOs can be funny too!

2008-09-10T12:15:00Z

Jessica Cheam shares colourful quotes from the Forbes Global CEO Conference.

JOURNALISTS are not known as early risers, our excuse often being that news always happens later in the day.

But for three days this week, I had to drag myself out of bed before 7am in order to get to Shangri-La hotel by 8am, when the annual Forbes Global CEO conference rolled into town.

The event - now in its eighth year - gathers more than 450 business leaders with a combined net worth of more than US$160 billion (S$229 billion). Unsurprisingly, a ballroom full of entrepreneurs from all corners of the globe threw up many colourful characters that provided both stimulating discussions and amusing gossip - which made getting up so early worthwhile.

It was the request of the organisers that the journalists didn't "mingle" with the delegates - who knows what we would have unearthed if we had the chance. We covered all the sessions from a media room that provided live feed of the plenary sessions. Any burning questions we had was saved for selected press conferences after the sessions.

Mr Steve Forbes, chairman and chief executive of Forbes, was very eloquent. He made no secret of his support for Republican candidate John McCain, declaring that McCain was 'better for free trade in Asia'. He did acknowledge, however, that the Democratic party was enjoying huge popularity in this election.

Elsewhere, at other sessions, another view emerged: "Obama is better for climate change" - but we had no space to run the story in print. As one expert summed up, "Obama is more likely to follow through with actions... McCain is more likely to just build more oil rigs, under pressure."

Climate change was the one topic that was glaringly missing, given that the conference was about issues that had relevance and currency. Topics at the conference, titled "The Winning Hand" ranged from strategies to combat global uncertainty and issues such as energy and commodities, real estate, India, entertainment, entrepreneurship and philanthropy.

Nobel prize-winning economist Michael Spence won my vote for "Man of the Conference" - if there was such a prize - for saying to a room full of capitalist entrepreneurs: "I know some people don't think climate change is a serious problem.. but I think we should buy some insurance on this."

Other quotable quotes from the conference included one from energy expert, Dr Fereidun Fesharaki, chairman and CEO, of Facts Global: "Oil is like dating. Gas is like getting married, requiring proper contracts, and long arrangements. Your mother-in-law (the banker) moves in with you to make sure you behave properly."

Besides predicting that within three to four years, the price of oil will be at the US$200 per barrel level, he also advocated that the United States tax its people for its oil consumption. One out of four barrels of oil produced is consumed in the US - "if you don't tax yourself, the market will tax you", he said.

Other gems that were overhead: Aussie actor Mel Gibson, who was invited to the conference last year, apparently got the organisers up in arms by turning up dressed in berms and crocs, while everyone else was in suit-and-tie garb for a very serious topic of discussion.

Nothing similar happened this year, though. Stars like pro-golfer Adam Scott and actor Jet Li turned up suitably dressed and won all the journalists over. The former, who no doubt would have won "Hottest Man of the Conference" was accosted by several helpers of the conference to sign autographs and take photographs. This reporter, mesmerized by his tanned looks and winning smile, was too embarrassed to do the same.

Lastly, I think the "Quote of the conference" prize should go to our very own Minister Mentor Lee Kuan Yew, who answered a question posed by Mr Forbes on the last day of the conference: how do you think history will remember George W Bush?

MM Lee thought for a moment and then replied, to an audience who roared with laughter: "I am not history".

And with that, the three-day affair was wrapped up.

This event is the last of three years in a row that Asia's premier business event is hosted in Singapore. It is moving to Kuala Lumpur next year. Shame, about that, I was starting to get used to waking up before dawn.

The modern-day matchmaker

2008-08-20T06:35:00Z

Jessica Cheam says don't be too quick to dismiss parents as matchmakers.

PARENTS as matchmakers?

You've got to be kidding, right? The Prime Minister's suggestion that parents play cupid in his annual rally speech has generated much debate, especially within the 20s to 30s age group - people grappling with issues of marriage and babies.

Parents could help, said Mr Lee to encouraging applause at the rally, perhaps with a helping hand from the People's Association (PA). Inspiration for this idea was a matchmaking trend in Beijing that caught his eye.

There, parents secretly seek partners for their children at 'Parental Matchmaking Sessions' in parks and apparently exchange photos, CVs, phone numbers which are then passed on to their kids, on the pretext of colleague recommendations.

Already, based on local online blogs and various anecdotal discussions, the initial reaction to this idea has produced a high dose of skepticism.

One contributor on local forum hardwarezone scorned: "We are not Beijing. Match-making moves our society backwards, not forwards."

So it is with great surprise, that some others such as 25-year-old Vivian Wong, told The Straits Times that she's fully in support of the idea.

"I'm busy enough with work, and if we can use headhunters to find jobs, why can't we deploy our parents to source and filter potential partners for us?" said the real estate consultant.

It seems easy, as a knee-jerk reaction, to laugh off the suggestion. But in light of contrarian views such as Ms Wong, perhaps there's something meaningful in the pursuit of this idea.

So let's analyse the pros and cons of having parents to match-make us with our future partner.

Let's start with the obvious cons: Some views gathered from a quick straw poll includes unwanted pressure from parents to go on arranged dates, the lack of spontaneity and suspense in "meeting someone", and the likelyhood that someone would dislike their parents choice since it's difficult for them to guess who would be a suitable companion.

Some singles such as Ms A Chua, 27, thinks that Chinese parents have "archaic, traditional notions" of what makes good partners, which will not match the younger generation's changing ideals of relationships and marriages.

"I was dating this guy who had an unusual job of buying and selling horses for a living and even though he was a great guy, my parents judged him immediately on his job, and disapproved of him on that basis," said Ms Chua. "For us younger Singaporeans, we tend to be more open-minded and frankly, as long as I feel a connection, I really don't mind what he does."

So what are the pros?

Well, according to Ms Wong, "parents know me in ways that even I'm unsure of myself. They can get rid of the "time-wasters" early on by screening them based on compatability issues like appearance, financial status, approach to life, religion etc".

For a majority-Chinese society like Singapore, parental approval is usually important in choice of partners anyway, she pointed out. "So it's good to find someone that my parents approve of to begin with."

Ms Wong added that when she worked in Beijing during a six-month stint recently, most of her colleagues were married by their mid-twenties - and majority of them had parents who had a hand in the choice of their partner.

And they are happy, she claims. One native Beijing colleague said she observed women from Singapore were picky about their spouses.

She recounts that one of them remarked: "Marriage is like chicken pox. Marry early, and it's less painful. And if you don't like it, you still have many years left to get another one to remarry."

Okay, so this might have been said more in jest than in seriousness. But as a point of comparison, most of Beijing's youth don't see it as an issue that their parents are involved in planning their marriages and/or partners, said Ms Wong.

This does not mean it might necessarily work for Singapore's youth. Chances are, parents and their children have to work out some sort of compromise, and be sensitive to each other's needs. Such as, if a person agrees to a date set up by their parents, all obligations and pressures from mum and dad stops there.

For singles looking for serious relationships, recommendations from parents who have screened potential partners will not be the worse thing - and maybe better than meeting random people at social settings, and after investing time and emotions in them, find out they are just "out to have fun".

Given that these issues of falling marriage and birth rates are long-term challenges for Singapore, as Mr Lee pointed out, perhaps we should not be so quick to dismiss the idea of the modern matchmaker.

After all, parents know best, right?

Who wins with no agent fee rules?

2008-08-07T08:13:00Z

Jessica Cheam speculates on real estate... guidelines.

HOW much should you pay your property agent?

This has been the talk of the town this week, and no surprise, given how home ownership issues are tied so closely to the hearts of Singaporeans.

When the Institute of Estate Agents (IEA) first announced the Compeition Commission of Singapore's (CCS) request to abolish a decade-old fee struture at a press conference: the initial mood all around was: "no biggie".

IEA's guidelines were non-binding anyway, said agency bosses. It was never compulsory, so its abolishment should have minimal impact. Many agencies, such as ERA, PropNex, C&H Realty told The Straits Times they will adopt IEA's fee recommendations as their own agency guidelines anyway so the status quo is maintained.

But as the industry digests the news, it seems that the removal of these guidelines will have far-reaching effects.

Already, the CCS and consumer watchdog Consumer Association of Singapore (Case) has issued statements to alert consumers to their rights.

Consumers should not accept agents "that are harping on the old fee practices" and should be free to bargain, Case said. It encouraged consumers to report any evidence of collusion on the part of the agencies, and advised consumers not to give agents exclusivity to sell their houses.

Already, home buyers and sellers that The Straits Times spoke to said that with the wide publicity of the guidelines removal, they feel their bargaining power has been enhanced.

House-hunter Vivan Wong, for example, said agents used to wave the guidelines in front of her, to justify collecting a 1 per cent fee for HDB transactions. "Now I can wave the CCS statements back at them," she said. She doesn't see why she has to pay 1 per cent to the sellers' agents. "Unless I specifically engaged a agent to hunt for a house for me, then I'll be happy to pay."

Generally, the mood on the ground is people are expecting fees in to dip in favour of the consumer. It'll be interesting to see if agencies' records on commission amounts will go down. PropNex agents collected $126 million in commission last year; ERA Asia-Pacific agents raked in $166 million. Both agencies are major players in the local property market. This was in the boom-time, of course, so any change in this year's earnings will be a combination of factors due to market conditions and the removal of fee guidelines.

Agents, however, are quite adamant that they will stick to their rates. PropNex agent Damien Goh, who sells an average of five properties a month, said 2 per cent was "already a very reasonable rate". Marketing just one property costs about $500 a month in advertisement costs, and another $100 in transportation costs, not to mention phone bills and overhead costs such as renting an office cubicle etc.

"I will show by actions and service, that I deserve that commission. If buyers or sellers still demand lower rates, I'll have to decide on a case by case basis. But if the fees are too low, I'll just look for another buyer and seller. I believe people will pay for good service," he said.

Other agents are less optimistic. Some say Singaporeans, known for their haggling, will demand the same level of service at low prices. "This may lead to more errant agents, who have less loyalty to their customers," said one agent who declined to be named. Complaints about agents to Case might even go up, he suggested.

PropNex chief executive Mohamed Ismail pointed out that the fees removal comes at a time where the industry is moving towards greater self-regulation, and agents are encouraged to move towards professionalism. "The impact of the fees removal can have two effects: agents will start to up their quality to be able to charge higher fees. Or two, a consumer-led dip in fees might lead to more irresponsible actions, if agents don't feel they're being paid enough."

On the other hand, home-buyer Tania Goh said unscrupulous agents who have a gem of a property could also jack up commissions if they know buyers or sellers are desperate.

Ultimately, the onus is on the consumer to be informed and educated about what the market rates and decide for themselves what are reasonable rates they should pay their agents.

The CCS move encourages competition in the market, and if agencies or agents can offer the same services for less money, there's no reason why market-based rates cannot prevail.

Time will soon tell who will be the real winners: consumers, or agents - or perhaps, both.