This year, Singapore and China celebrate 30 years of establishment of formal diplomatic relations. I experienced that moment of history personally. I was Singapore’s permanent representative to the United Nations when Singapore's Foreign Minister Wong Kan Seng and China's Foreign Minister Qian Qichen signed the joint communique stating their intention to establish diplomatic relations, at the UN headquarters in New York on 3 October 1990. I was in the room, in the background.
Both sides considered this a formality, but an important and consequential formality. Singapore had developed close economic and political ties with China before this date on an informal basis. Prime Minister Lee Kuan Yew made his first official trip to China in 1976 and Vice-Premier Deng Xiaoping came to Singapore in 1978 during his visit to Southeast Asia which included Thailand and Malaysia. Respective trade representative offices were set up to facilitate the economic links in 1981.
As an ethnic Chinese majority nation in Southeast Asia, in the Malay archipelago, Singapore said it would be the last country in ASEAN to establish diplomatic relations with China, after Indonesia. That position was laden with meaning and signalled the delicate geopolitical situation Singapore occupied in relation to its ties with China and its location in the region. Singapore is also a multiracial society, so its balance was not just external but also a matter of internal sensitivities.
It is important to remind ourselves of the geostrategic context of the normalisation and growth of relations between China and the region. The Cold War was still on. The US-China detente that came with Nixon's visit to China in 1972 made it possible for countries in the region to establish relations with China which they rapidly did. Deng Xiaoping's decision to put China on the path of Four Modernisations opened up many possibilities for engagement. Deng came to Southeast Asia to Thailand, Malaysia and Singapore. He was interested in canvassing support against Vietnam and Russia.
Deng believed Singapore had something to offer for China’s development. He said: “There is good social order in Singapore. They govern the place with discipline. We should draw from their experience and do even better than them.” China, at that point in time, was interested in Singapore as a market economy model and its success in development. Later, I believe China saw Singapore as a strategic way to engage with the regional and international system as Singapore had good relations with many countries and with the US. Singapore was an early supporter of China's peaceful and constructive development in the region. We believed and still believe that China's growth and development is good for the region and good for the world.
A history of cooperation
Since 1990, Singapore's relations with China have grown from strength to strength. We have substantive cooperation which is multifaceted. In 2019, China was Singapore's largest trading partner and Singapore was China's largest investor.
Cooperation has been at many levels. Many of you are familiar with the large projects of the Suzhou Industrial Park, the Sino-Singapore Tianjin Eco-City, and the most recent, the Chongqing Connectivity Initiative. Each represented a different phase of our cooperation which was seen to be useful for China and provided an opportunity for Singapore to work with China.
In Suzhou, we introduced what you might call the “software” of development, financial discipline, long term master planning, and continuing service to investors, the Singapore way. It would be more than the focus on the hardware, the buildings. It was an experiment to be introduced to other Chinese cities. The Tianjin project came at a stage when China was interested in sustainable development and the Chongqing Connectivity Initiative showed that Singapore and China could work together to develop financial services, aviation, transport and logistics, and the information and communications technology (ICT) sector. With the Chongqing Connectivity Initiative, we hope to develop the New International Land Sea Trade Corridor and the Maritime Silk Route.
China and Singapore signed a Free Trade Agreement (FTA) in 2008, the first for China with an Asian country. All trade agreements are strategic. This was the forerunner of the China-ASEAN FTA.
Singapore accounts for 85% of total inbound investments to China from BRI countries and nearly one third of China's outbound investments to BRI countries flow through Singapore.
We have developed many platforms for our leaders and people to engage. To name a few, there are the Joint Council for Bilateral Cooperation (JCBC) led by Deputy Prime Minister Heng Swee Keat and Vice- Premier Han Zheng, the Singapore-China Forum on Leadership led by Senior Minister Teo Chee Hean and Central Organisation Department Minister Chen Xi, and the recently established Singapore-China Legal Roundtable co-chaired by Singapore's Chief Justice Sundaresh Menon and the Supreme People's Court President Zhou Qiang. Then there are the eight business councils at the provincial levels headed by ministers and vice-ministers.
When China introduced the Asian Infrastructure Investment Bank (AIIB) and the Belt and Road Initiative (BRI), Singapore was one of the countries that came out early in support of the projects. We now work with China on third-country projects of the BRI. The BRI has been a major opportunity for cooperation in infrastructure and financial connectivity with China. Singapore accounts for 85% of total inbound investments to China from BRI countries and nearly one-third of China's outbound investments to BRI countries flow through Singapore.
Each side sees the strategic value from their own point of interest and we work out a strong and substantial relationship for our mutual benefit.
This is a simple indication of the different levels of engagement and the scope of cooperation that exists. In laying out the broad picture of our collaboration it would be incomplete not to mention that there are differences in views and some episodes of difficulties in our relationship, but that occurs in all bilateral relationships.
In fact, the Covid pandemic has seen a flurry of activity and high-level discussions and visits on both sides. Singapore's first fast lane opened during the pandemic was with China and China's first with a Southeast Asian country was with Singapore.
Whether it was on trade, economic engagement, investment, technical development, each sector, each project was entered into for strategic reasons. Each side sees the strategic value from their own point of interest and we work out a strong and substantial relationship for our mutual benefit.
US-China relationship — decibels will be lowered
The question is, what next?
The world we face today is fraught with tension and turmoil. It is not just because of the Covid-19 pandemic which has nearly paralysed the economies of the world.
The US-China relationship, which is the most consequential relationship in the whole world, has never been in such a rancorous state. The relationship has never been easy for the two great powers to handle but different American administrations have managed to work out how to deal with China as a strategic competitor or a strategic rival. Now there is a bipartisan consensus in Congress and political elites to regard China as a strategic adversary. The election of President Trump brought that view into sharp focus although the way the US regarded China was rapidly changing during the Obama administration in response to China’s policies and actions. President Trump launched a trade war, an investment war and now a tech war seeking to decouple the technology economy. His administration labelled China a “revisionist power” and their speeches echoed the rhetoric of the Cold War. Mr Henry Kissinger said at the Bloomberg New Economy Forum in 2019 that “we are at the foothills of a Cold War”. In 2020, at the same forum this year he said that “we are in the mountain passes”.
But President Trump did not just recast the relationship with China. Emphasising “America First”, he launched a broad attack on multilateralism, by withdrawing from the Paris Agreement, the Trans Pacific Partnership (TPP), attacking the WTO for being unfair to America, refused to appoint new members to the WTO Appellate Body, in effect killing it. The disregard for the UN is seen in the threat to withdraw from WHO in the midst of a global pandemic, the withdrawal from UNESCO and the UN Human Rights Council.
I am expecting greater predictability to return to policies. The decibels will, I believe, be lowered, which in this climate and context, will be very helpful.
With the election of Joe Biden as the 46th president of the US, allies of the US and countries around the world are expecting some changes to be made certainly to multilateralism and how the US will treat allies. It is thought the US-China policies will not see major shifts as Biden will not have much room given the bipartisan positions on the relationship and the fact that the Trump administration has at this last stage of its office introduced a number of policies on China which would be hard to dismantle. A recent example is the executive order barring American investments in Chinese firms owned or controlled by the military. So investment firms and pension funds cannot buy or sell shares of 20 Chinese companies designated by the Pentagon as having military ties. Congress which is evenly divided, would work hard to block changes where they can. But I am expecting greater predictability to return to policies. The decibels will, I believe, be lowered, which in this climate and context, will be very helpful.
The future of Singapore-China relations
Given this backdrop, what can Singapore and China do in terms of strategic collaboration? There is much to be done in the region for the region to make it a stronger resilient place.
The Regional Comprehensive Economic Partnership (RCEP) has just been successfully signed. It is a significant milestone involving 15 countries and took us eight years to conclude. It is the largest trade agreement in existence. The next step would be for all the RCEP countries to ratify and implement the agreement to fulfil its full potential. Singapore and China can play a role in encouraging member parties to ratify the agreement and work on the Work Programme items. The Work Programme was not completed before we signed. There is the area of Investment Protection which would be important and facilitate movement of capital in the region. RCEP can look at how to expand the agreement which is possible after it is in existence for eighteen months. We should of course encourage India to come back into RCEP as it was originally among the negotiating parties.
Notwithstanding RCEP, Singapore and China and the other ASEAN countries should enhance the ASEAN-China FTA. ASEAN and China worked step by step on the first FTA and as a tighter smaller group it is easier to move the group. China and ASEAN can work on how to minimise the new non-tariff barriers. ASEAN countries and China should take a serious look to see how both sides can enhance the FTA by sorting this remaining barrier.
Now, China, I'm sure will be consulting many member countries on the CPTPP as agreement to admit a new member must be unanimous. Singapore would be happy to brief China to provide our point of view.
Recently, at the APEC Summit, five days after the signing of the RCEP agreement, President Xi Jinping announced China's interest to think about joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) "positively". This is the highest-level confirmation of China's interest and follows Premier Li Keqiang's statement in May indicating China's interest in CPTPP. Actually, when TPP was first mooted around 2009, China went to a few embassies in Washington to find out what the TPP was about to learn more. Now, China, I'm sure will be consulting many member countries on the CPTPP as agreement to admit a new member must be unanimous. Singapore would be happy to brief China to provide our point of view.
There is much we can do together in the digital sector. Given China's advancement in smart technology and Singapore's achievements to further the Smart Nation, we can collaborate to help ASEAN cities in the ASEAN Smart Cities Network to build up their capability. This is a Network of 26 ASEAN cities. This will enhance ASEAN competitive strength and build an ASEAN regional e-commerce ecosystem. At a time of the pandemic, it is even more urgent.
Singapore and China are already working on the BRI to go to third countries for investment. We should continue with this, and learn and adjust as we go along.
Singapore and China can exchange views on WTO reform. We both want to keep the international trading system to remain open and the multilateral trade organisation to succeed. China wants WTO to work. With the change of personnel in the White House, it is likely that President-elect Biden also wants WTO to work as well. Neither great power thinks WTO is working so well as it is. It may be a good time to think of WTO reform. Singapore would be ready to join discussions on this and hopefully be constructive. I have always thought the early ideas of WTO reform could be discussed and tested at G20. The essential participants are there as well, China and the US, developed nations as well as developing nations. Singapore is not a member of G20, but we have been invited to most of the G20 meetings as a thought leader of the Global Governance Group (3G) at the UN composed of small nations.
ASEAN has adopted the ASEAN Outlook on the Indo-Pacific (AOIP) which is an inclusive concept and not targeted at any country. It is also largely economic. China has accepted the AOIP and we hope China would be one of the countries helping ASEAN fulfil the promise of AOIP.
Singapore and China could work together for a conclusion of the Code of Conduct (COC) in the South China Sea which will help to stabilise the tensions in the South China Sea among the claimant states. Singapore is a non-claimant state, but we have real interests in the freedom of the sea-lanes as a maritime nation. Singapore is forward leaning on this, but we also want an effective and substantive agreement. It should not be an agreement at any cost. The parties must fully understand the obligations of the COC.
Finally, a word on the Indo-Pacific strategy. Much has been said about this since the Trump administration floated the idea of the Free and Open Indo-Pacific and renamed its Pacific Command, the Indo-Pacific Command. Now, many European countries have come out with their own Indo-Pacific strategy, notably, France, Germany and the Netherlands. Others are preparing their versions. ASEAN has adopted the ASEAN Outlook on the Indo-Pacific (AOIP) which is an inclusive concept and not targeted at any country. It is also largely economic. China has accepted the AOIP and we hope China would be one of the countries helping ASEAN fulfil the promise of AOIP.
Related: Singapore’s ambassador to China Lui Tuck Yew: Singapore must stay relevant to China | Reflections by George Yeo: Celebrating 30 years of diplomatic relations between Singapore and China | Yang Jiechi’s Singapore visit: Seeking strategic space | Beyond 30 years: History, places and images of Singapore-China relations | Chinese ambassador Hong Xiaoyong: New journey for China’s development; new opportunities for China-Singapore cooperation