The corporate debt market has quadrupled since end-1996 with $ 103 billion of corporate debt securities outstanding as at end-2003. Debt issuance has increased substantially from only $ 5.4 billion at end-1996 to $ 67 billion in 2003, a compounded annual growth of 43%. The profile of debt issuers has also changed. Statutory boards used to dominate, but now form only 3% of total issuance. Instead, the debt market has a stable base of large corporates and financial institutions issuing bonds well over $ 1 billion in issue size. This has increased liquidity in the secondary market. Large international issuers such as IFC, Freddie Mac, Fannie Mae and ADB, which can tap any market in the world, have chosen to raise funds in Singapore. Treasury markets have also stayed buoyant, as Singapore remains one of the established leading global FX trading centres. The creation and hedging of structured products have boosted turnover in derivative markets. Singapore now ranks 6th globally, in OTC FX and interest rate derivatives. Reforms were also introduced to deregulate the stockbroking industry. The industry has consolidated, operating more leanly on much lower commissions. The bigger local players have expanded their product range and also expanded overseas. More foreign players have entered the market. Overall, investors have benefited from lower trading costs. SGX became the first demutualised, integrated stock and derivatives exchange in the Asia-Pacific in December 1999. It is now well placed to grow its business, and respond to developments in regional capital markets.
The same applies to the return on GPFG capital. The three paths illustrate the uncertainty we are facing, but they also illustrate another important point. Spending the return will ultimately lead to a flattening of the GPFG, which will then decline as a percentage of GDP. It has always been clear that this will happen at some point in the  8  BIS central bankers’ speeches  future. What is new is that this may be the case here and now. At today’s oil price, the GPFG may have reached the peak. In that case, petroleum revenue spending as a percentage of GDP must be reduced to avoid using more than the return on the GPFG. Even if the oil price and the rate of return follow a path that allows the GPFG to grow for a period ahead, petroleum revenue spending should be restrained. By keeping spending well below the upper bound, the need for fiscal retrenchment further ahead can be reduced. The fiscal rule has functioned as a long-term guideline for fiscal policy for nearly 15 years. It has served its purpose. The time has now come to show restraint. A sensible risk adjustment is now to refrain from increasing petroleum revenue spending further from today’s level. The era of rising petroleum revenue spending may be behind us. Conclusion The more than forty-year-old white paper on the role of the petroleum industry in Norwegian society was far-sighted and proved to be on the mark.