Muhammad Nazri Hadi bin Saparin (BH): To kick things off, can you explain the significance of the visit to Singapore, the region as well as Asia?
Minister: Let me put it to you this way, COVID-19 has put a major dampener on all usual diplomatic activities for more than one and a half years. The first point is that this visit, in a sense, also represents a slow return to (the) normal of diplomatic activity. The second point is that this is Vice President Kamala Harris’ first visit in her capacity (as Vice President) to Asia. We are very glad that she has decided to start that by visiting Singapore, and then she will go on to Vietnam. The third point is that there is a lot happening in a world right now. I think it would bean excellent opportunity for the Biden Administration, and for her (Harris’) accompanying staff and herself to get both a bird’s eye view as well as an on the ground assessment of what is happening in Asia, what are the key issues, how we look at them, and how America can continue to engage in a positive and constructive way, with the rest of us in Southeast Asia and beyond. I think the point here is that even in this day and age, with video conferences, television, (and) the rest of it, there is still no substitute for direct face-to-face interaction, for private conversations, for an informal avenue for insights, questions and comments to be made. That is why in-person visits at the senior level remain essential.
Irshath Mohamed (TM): Morning, Minister. I am Irshath from Tamil Murasu. Thank you for this opportunity to interview you. My question is about Singapore- United States (US) relations. Both countries enjoy 55 years of diplomatic relations. How can we further enhance our relations with them?
Minister: Well, I think let us first review the last 55 years. In fact, if you go back 70 years to the end of the Second World War, the United States was the undisputed winner. The US’ GDP at that time probably constituted about 40% of (the) global GDP. The US was a key founding member of international organisations like the United Nations, the International Monetary Fund, the World Bank, World Trade Organization, and even the World Health Organization. The US in the past seven decades, envisioned and essentially underwrote the liberal, free trade, economic integration, rules-based world order that we have all become familiar with. That was a formula for global peace and prosperity. In fact, one of the big beneficiaries of this form of political economy on a global scale has been Southeast Asia, and in particular, Singapore has been a key beneficiary of such a system. Therefore, if you cast your mind back 55 years, when we needed to industrialise quickly, the ability to attract multinational corporations – and a large number of those were American, that is (also) why today we have over 5000 American companies here, who brought their investments, their technology, their markets, and their networks to Singapore – actually turbocharged our economic transformation over the past five decades. More specifically if you look at investment flows, the US is the largest foreign investor in Singapore. In fact, the US is the largest foreign investor in Southeast Asia. The US has more than 329billion US dollars stock of investment in Southeast Asia. I used to regularly remind President (Donald) Trump and his other officials that the US has invested more in Southeast Asia, then it has in India, China and South Korea combined. It is a very big account. That is on investments.
On trade, I think you know that we signed the US-Singapore Free Trade Agreement in 2003. It came into force (in) 2004. The negotiations for that started in a golf game between then-Prime Minister Goh Chok Tong and President Bill Clinton in 2000. Since then, trade with the US has doubled, the US is our second or third largest trading partner for goods, but is our largest trading partner for services. If you look at both investment and trade account, there is no question that these are big, significant, major elements of our relationship.
The other dimension, of course, and I am sure you are aware that the Secretary of Defence, Lloyd Austin, was here just two weeks ago. We have excellent relations on the defence front. We are not a formal treaty ally, but we are in a special category called the “Major Security Cooperation Partner”. The US is the heaviest user of our facilities – Changi Naval Base and Paya Lebar Air Base. These are facilities which are open to other nations as well, but they happen to be the heaviest user of these. In terms of our equipment, operating procedures, and access to technology, the US has been a key partner. Looking forward – and this relates to the Vice President’s visit – I would indicate four areas which we are looking at. Number one is doing more together on the pandemic front, and especially in terms of helping our region and our neighbours cope with the immediate impact of the Delta variant wave. There is going to be quite a lot of discussion on pandemic response and how we can work together to help others. The other area, of course, will be in terms of the digital economy. Again, you know, that Singapore is engaged in Digital Economy Agreements (DEA) with Australia and New Zealand and other countries. We want to see or explore whether the US can be part of these emerging architecture for the digital economy.
The third area will be in the green economy. I think you have seen the latest Intergovernmental Panel on Climate Change (IPCC) report – climate change is an even more urgent and pressing problem. I believe the Biden Administration shares our view. We will be trying to explore opportunities for agreements on norms, and hopefully on global arrangements, which would help us transit more quickly into a greener, more sustainable economy. That is the third area of focus. The fourth area will include more topical and security-related issues like cybersecurity. As we become more dependent on the digital economy, we are also at greater risk. This (cybersecurity) is another area where we hope to collaborate more intensively and deeply with the US. Historically, we have a long, deep track record. Prospectively, there is a lot to explore in the near future as well.
Irshath Mohamed (TM): Thank you Minister for the detailed reply. The next question is how can Singapore play a part in being the gateway to ASEAN for the US?
Minister: We are a city-state that is multi-racial and multi-religious in the heart of Southeast Asia. We have some of the best infrastructure and connectivity – you talk about air and maritime – but equally important now, on the digital, broadband and fibre optic traffic, are the connections within ASEAN and beyond ASEAN to Asia. Singapore has a whole network of free trade agreements, but we always put this in context that any arrangements with us – whether it is the US-Singapore Free Trade Agreement, or in future, a digital economy agreement, or a green economy agreement – are pathfinders. It is a first step in a longer journey to reach out, engage and integrate with Southeast Asia. That is the way we approach it, and I believe all our major partners, whether it is the US, the EU, or China, look at Singapore as a portal, as an interface, as a point of engagement, not just with Singapore, but with Southeast Asia and beyond. That is the role we typically seek to play.
Irshath Mohamed (TM): Thank you, Minister.
Grace Ho (ST): You mentioned the four areas of focus. Would you be able to share any specific deliverables that are tied to these priority areas? Also in relation to that, Prime Minister Lee Hsien Loong had earlier shared about how there was this palpable sense of relief that the US is engaging its partners again. Do you see this sort of engagement, whether it is in our areas of interest or beyond, a degree of strategic consistency for the long term? Or because of the potential that it might be a short presidency, that we might go back to a less controlled situation again?
Minister: The first question on the specific agreements and deliverables, I think you will have to wait another week because even right now, we are still discussing with her office. For that list, we will issue a proper press release. But I have outlined the areas where we are looking for key, specific deliverables. Your next question, I would answer it at several levels. First point is that, in fact, Singapore has always had excellent engagement with successive administrations, regardless of which party was in power. To give you some data points again, if you think back over the last five, six years, Prime Minister Lee was invited by President Obama to a State Dinner, that was in August 2016. I remember that because we had to rush back for National Day. In 2017, President Trump invited Prime Minister Lee, again, for an Official Visit to Washington. I recall staying in Blair House again – this was just within a year. In 2018, President Trump came to Singapore for the Trump-Kim Summit. In 2019, Prime Minister Lee again made a working visit to New York, and he and President Trump signed the Protocol of Amendment to the 1990 Memorandum of Understanding Regarding United States Use of Facilities in Singapore. If you look at this sequence, the point is that we have always had excellent engagement, in fact with fairly high intensity, which reflects the strength and the depth of the relationship between Singapore and the US. It is a problem-free relationship, but it is not one that is taken for granted. That is good. Therefore, we welcome the visit by Vice President Kamala Harris in that same spirit of engagement. In fact, it also recalls Vice President Biden’s earlier visit to Singapore. I remember when I met Vice President Biden (in Washington D.C) in 2016, he fondly recalled his visit (to Singapore) – I think it was in 2013. He fondly recalled his conversations with Minister Mentor Lee Kuan Yew, as well as his diversion to Adam Road Hawker Centre. So engagement has always been there. It has been good, trouble-free, but not taken for granted. We have continued always to look for new avenues, new opportunities to collaborate, to be relevant, and to engage and integrate with our neighbours in Southeast Asia. That is the point on engagement.
Your next question was on consistency. We have to acknowledge that there are major domestic political changes afoot within the US, and it is important to understand that foreign policy begins at home. Consistency in foreign policy, in fact, is a function of domestic politics. If a country is polarised or divided, or is still finding its way domestically, to achieve unity and to arrive at a political consensus – clearly, the last decade or so in the US has been a period of quite a lot of fundamental domestic questioning of political presumptions – we should not be surprised that some of this leaks out into its foreign engagements. But having said that, if you look at what the US has done in practice with Singapore or with Southeast Asia, you do see key themes which are consistent, and I alluded to them earlier. In terms of investments, American multinational corporations’ investments continue to be very significant. Last year, EDB recorded (that) it was a record year for FDI into Singapore, and a significant proportion of that represents American companies. More recently, if you look at GlobalFoundries, the manufacturer of semiconductor wafers – it is another big investment made in Singapore. If you look in terms of their attitude to trade – it is a pity; a pity that America was not able to follow through on the TPP (Trans-Pacific Partnership). But our trade with America continues to be healthy and continues to have prospects for growth. You see that there is consistency on the economic front, particularly from the private sector of America. It is worth remembering that one key design feature is that the American corporate sector is not an arm of the state bureaucracy. So again, I am saying there has been consistency on the economic front.
There has been some prevarication on climate change. President Trump withdrew from the Paris Agreement, (and) President Biden has re-entered the Agreement. But I think that ultimately, this is something which Americans at the domestic level will have to decide for themselves. Whether they believe that climate change is real and that there is a whole new green economy beckoning, and America should play a leading role technologically, in standards, norms, engagements (and) international agreements in the green economy. We hope as they settle the question domestically, that there will also be more consistency in their foreign policy pronouncements in these areas. In terms of the digital economy – again, if you look at the presence of Silicon Valley companies in Singapore, it is on a definite uptrend. No question about that. Now, how can we facilitate so that you have a conducive regulatory environment for digital growth, to not only be more sustainable and inclusive as well as (opposed to) just technically bells and whistles? This again is another opportunity for us to do more. But again, I am trying to answer your point on consistency. Let us judge by actions and outcomes, and understand that pronouncements will necessarily have to reflect the internal debates which are going on within the US. But we will have to wait for this process to be completed within the US.
Yeo Chun Hing (LHZB): Good afternoon, Minister, this is Chun Hing from Zaobao. Both Washington and Beijing have suggested that they might be open to re-joining or joining the CPTPP. Do you intend to discuss the CPTPP with VP Harris this time around?
Minister: That is a good question. Again, it can be answered at several levels. I already said it was a great pity that the US, having been a key part of the negotiating team – and the TPP is a very high-level agreement, ambitious, with high standards on the economic front, on the labour front, and on the environment front. To my mind, it still remains a gold standard agreement – it is a pity that the US could not follow through, could not sign, and obviously therefore, the question on ratification is not even there. It is worth reflecting (that) the United States could not proceed because of its own domestic, political and fundamental questioning that is going on. This was a period when many Americans, especially those in the ‘Rust Belt’, were questioning the value of globalisation, of free trade , were even perhaps insecure about their ability to compete in a globalised world.
The short answer to your first question – is there any immediate prospect of America rejoining the CPTPP? I am afraid the answer is no. But having said that, in all my conversations over the years with my American interlocutors, they all acknowledge that the CPTPP is not just an ordinary trade agreement. It is really an icon in Southeast Asia, (where) trade is strategy. It is an icon of economic integration, of having real stakes in this part of the world. (It is) therefore looked upon as an index of future commitment. I said it is a pity, and I have often reminded my American friends that if you look at the track record of investments and free trade, America is in a leading position. For them to have been in a leading position and to not have been able to sign on is a great pity. To be frank with all of you, none of them actually make any serious arguments with me on this question about the strategic importance, but they all concede (that) it is the domestic politics which does not allow them to proceed.
Interestingly, it is China now that has evinced interest in the CPTPP. I believe it reflects China’s view that globalisation, economic integration, and investing and trading with Southeast Asia and other partners across the Pacific is important. Just as a side factoid, the biggest trading partner of China is not the US. The biggest trading partner for China now is ASEAN – Southeast Asia. It shows you that the growth of trade both ways has increased. That is why in addition to the RCEP which we signed and China is a signatory to that, China is now also looking carefully at the CPTPP. For us, because we are a tiny city state in the heart of Southeast Asia, at the rim of the Pacific Ocean, and trade is three times our GDP – you realise therefore for us, we will welcome more. The more the merrier, on both the RCEP where India is still missing, and (the) CPTPP. If you can imagine – although probably not likely an immediate prospect – a CPTPP with both America and China being (a) part of it. That is a very big deal. We will have to wait and see, but you know what our attitude is. We believe that free trade is critical. We believe globalisation, which operates on the basic economic 101 principles of economies of scale and the comparative advantage of specialisation, continues to operate. Having said that, I think with the benefit now of the last decade, it is clear that even globalisation has its limits and you cannot have completely unfettered capitalism. To quote our Prime Minister, you do need some firewalls, you do need some safety belts. Most important, you cannot effectively globalise unless you have invested in your own people, and you have given confidence to your own population and your citizens that we have the skills, the tools, the infrastructure and the wherewithal to compete, and compete against the best in the world. This is another example where trade and foreign policy are actually secondary to domestic policy. I believe that all over the world, there is a need for good governance, investment in an upgrade in infrastructure fit for a digital age, reform of education, and SkillsFuture training so that people can seize the opportunities from this new digital, globalised and hopefully green world that is emerging. That is something to keep an eye on.
In the meantime, we are watching with concern both the political and economic relationship between the US and China. Here again, Singapore is in a delicate and somewhat unique position. I have already told you – the largest foreign investor in Singapore is America, and America remains a vital trading partner. America remains a vital source of technology, ideas and talent for us. But we should also remember – Singapore’s largest trading partner is China. In fact, Singapore is the largest foreign investor in China. We have real stakes, we have real skin in the game – in China continuing to do well, and in hoping that both China and the US can sort out a new modus vivendi, can learn to live with each other as peer superpowers, can sort out their rules of engagement, can sort out how their economies will continue, hopefully, to engage rather than bifurcate. If there is a lack of strategic trust at the highest levels on both sides, that will pose problems, not only for them, but for the rest of the world and certainly for a place like Singapore. We do not set the agenda in Washington and Beijing. But I believe we are good friends with both. We are trusted friends. I do not have the luxury of saying one thing in Washington and another thing in Beijing. I always say the same thing to both. But to be able to express it in a constructive and helpful way, and yet in a transparent and sometimes frank way, that is where the art of diplomacy comes in. We will have to wait and see. This is an area of great concern. But back to your question, do we hope to see more people sign on to the TPP, the answer is yes, we do.
Yeo Chun Hing (LHZB): Vice President Harris’ trip to Asia this time round has been reported or seen as a move to bolster international support to counter China’s influence and to push back on China’s South China Sea claims. How can Asia, especially ASEAN, avoid becoming a site for proxy conflicts between US and China?
Minister: Our position on the South China Sea is well-known. Completely consistent, it has not changed. I will just recite the standard points first – worth reciting. One, we are not a claimant state. We have no territorial disputes in the South China Sea. Second, having said that, we do have interests at stake, because the South China Sea is such a crucial portal for maritime trade. Therefore, any instability, any tension, or worse, conflict in the South China Sea would have very adverse consequences for us. We remain concerned. The third point is that because we are a tiny city state, for us, by definition, we must believe in international law. We must believe that there are peaceful ways of resolving disputes. In particular for us, when we talk about international law as far as the sea is concerned, we believe in the 1982 UNCLOS – United Nations Convention on the Law of the Sea. That must remain the primary document on which maritime issues are resolved via international law. The fourth dimension is to maintain ASEAN Centrality, ASEAN unity. Singapore has continued to play what can be characterised as a key role in the ongoing negotiations for the COC – the Code of Conduct (in the South China Sea). We have made some progress. Recently, the officials met. That was in June. We settled the provisional agreement of the Preambular paragraph of the Single Draft Negotiating Text (SDNT). It is a long way yet to arrive at a meaningful and effective Code of Conduct. Nevertheless, the fact that we are working hard on it is a good sign. But do not be impatient. That remains our position. This is what I have said to my counterparts on both sides in America and China. I am sure the Prime Minister will have further conversations with Vice President Harris.
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