TIANJIN: Countries should respond to weakening global norms by promoting integration, breaking down barriers and strengthening multilateralism, said Singapore Prime Minister Lawrence Wong on Wednesday (Jun 25).
Stressing that it is possible to update the rules of global trade and improve the multilateral system, he added: “It is painstaking work, but there is no alternative. A new system does not just appear like magic. You have to work at it.”
This could include what he described as “flexible multilateralism” – start work with like-minded countries and others can join when they are more ready, he said during a dialogue with World Economic Forum (WEF) president Borge Brende.
Speaking at the WEF Annual Meeting of New Champions in Tianjin, also known as the Summer Davos, Mr Wong noted that the world went through an unprecedented period of global integration after the Cold War ended.
Unfortunately, the world is changing, he said. “We see over the years, more pressures, discontent against globalisation has risen.”
In more recent years, because of the COVID-19 pandemic and concerns over security because of conflict in Europe and the Middle East, the world is in a very different position today, he added.
“Global norms, global rules are weakening. Global institutions are weakening. And economic nationalism is replacing win-win cooperation,” said Mr Wong.
Smaller countries like Singapore are worried because they have limited options and bargaining power, and risk being marginalised, he added.
But even bigger countries will face challenges in this new environment because it will be harder for all to deal with common threats – pandemics, climate change or financial shocks, said Mr Wong.
“I think our response has to be collectively to try and still harness forces that will bring people together, promote integration, break down barriers and strengthen multilateralism,” said the prime minister, adding that Singapore will do its part.
“Multilateralism that is more resilient, more inclusive and better suited to the realities of our time.”
Using the World Trade Organization (WTO) as an example, Mr Wong noted that the system is “not working as well”, and that some of its rules have “lagged the realities of today’s economy”, like the rise of digital trade.
“Again, the response is not to jettison the rules, but to think about how it can be improved,” he added.
Mr Wong noted that Singapore worked with Australia and Japan to co-convene the Joint Statement Initiative on E-Commerce. After five years of negotiations, more than 70 countries have now agreed on the first set of rules for digital trading.
These illustrations show that it is possible to update the law to improve the multilateral system and global institutions that the world has today, said Mr Wong.
During the dialogue, Mr Brende asked Mr Wong about the 10 per cent tariffs placed on Singapore by the US, which the former described as a “relatively good deal”.
Singapore has a free-trade agreement with the US, and the US has a surplus with Singapore, Mr Wong noted, inviting the audience to “look at the facts”.
“So on the basis of the FTA and the facts of the trade balance, we should have a zero tariff, not a 10 per cent tariff. But I think America has decided that 10 per cent is their baseline tariff, and they are probably not going to go below 10 per cent,” said the prime minister.
“We have been engaging the officials, but that, I think, is their sort of mindset at this stage,” said Mr Wong.
He also noted that other Southeast Asian countries face higher tariffs. Singapore hopes that when America makes a decision on the "reciprocal tariffs", this will come down, closer to 10 per cent, he added.
Mr Wong also responded to a question from Mr Brende about how Singapore balances its relationship with both the US and China.
The prime minister stressed that Singapore has “broad and substantial” relations with both countries.
“I know everyone monitors and tracks what we say and what we do very closely, trying to parse every hidden meaning behind every word, behind every action, whether we are moving close to one or the other,” said Mr Wong.
“But that’s not how we look at things, that’s not how we approach it.”
Singapore’s “starting point” is what will advance the country’s national interests, he said.
With good relations with both the US and China, Singapore will continue to do whatever it needs to do to promote and advance Singapore’s interests, he added.
“It’s not about balancing between the two superpowers, but it’s about being consistent and principled in advancing and promoting Singapore’s interests.”
If Singapore continues to do this in a “consistent and principled manner”, its partners – US, China and other countries – will see it as a reliable and trusted partner, said Mr Wong.
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Stressing that it is possible to update the rules of global trade and improve the multilateral system, he added: “It is painstaking work, but there is no alternative. A new system does not just appear like magic. You have to work at it.”
This could include what he described as “flexible multilateralism” – start work with like-minded countries and others can join when they are more ready, he said during a dialogue with World Economic Forum (WEF) president Borge Brende.
Speaking at the WEF Annual Meeting of New Champions in Tianjin, also known as the Summer Davos, Mr Wong noted that the world went through an unprecedented period of global integration after the Cold War ended.
Unfortunately, the world is changing, he said. “We see over the years, more pressures, discontent against globalisation has risen.”
In more recent years, because of the COVID-19 pandemic and concerns over security because of conflict in Europe and the Middle East, the world is in a very different position today, he added.
“Global norms, global rules are weakening. Global institutions are weakening. And economic nationalism is replacing win-win cooperation,” said Mr Wong.
Smaller countries like Singapore are worried because they have limited options and bargaining power, and risk being marginalised, he added.
But even bigger countries will face challenges in this new environment because it will be harder for all to deal with common threats – pandemics, climate change or financial shocks, said Mr Wong.
“I think our response has to be collectively to try and still harness forces that will bring people together, promote integration, break down barriers and strengthen multilateralism,” said the prime minister, adding that Singapore will do its part.
“Multilateralism that is more resilient, more inclusive and better suited to the realities of our time.”
Using the World Trade Organization (WTO) as an example, Mr Wong noted that the system is “not working as well”, and that some of its rules have “lagged the realities of today’s economy”, like the rise of digital trade.
“Again, the response is not to jettison the rules, but to think about how it can be improved,” he added.
Mr Wong noted that Singapore worked with Australia and Japan to co-convene the Joint Statement Initiative on E-Commerce. After five years of negotiations, more than 70 countries have now agreed on the first set of rules for digital trading.
These illustrations show that it is possible to update the law to improve the multilateral system and global institutions that the world has today, said Mr Wong.
Related:
US tariffs
During the dialogue, Mr Brende asked Mr Wong about the 10 per cent tariffs placed on Singapore by the US, which the former described as a “relatively good deal”.
Singapore has a free-trade agreement with the US, and the US has a surplus with Singapore, Mr Wong noted, inviting the audience to “look at the facts”.
“So on the basis of the FTA and the facts of the trade balance, we should have a zero tariff, not a 10 per cent tariff. But I think America has decided that 10 per cent is their baseline tariff, and they are probably not going to go below 10 per cent,” said the prime minister.
“We have been engaging the officials, but that, I think, is their sort of mindset at this stage,” said Mr Wong.
He also noted that other Southeast Asian countries face higher tariffs. Singapore hopes that when America makes a decision on the "reciprocal tariffs", this will come down, closer to 10 per cent, he added.
Mr Wong also responded to a question from Mr Brende about how Singapore balances its relationship with both the US and China.
The prime minister stressed that Singapore has “broad and substantial” relations with both countries.
“I know everyone monitors and tracks what we say and what we do very closely, trying to parse every hidden meaning behind every word, behind every action, whether we are moving close to one or the other,” said Mr Wong.
“But that’s not how we look at things, that’s not how we approach it.”
Singapore’s “starting point” is what will advance the country’s national interests, he said.
With good relations with both the US and China, Singapore will continue to do whatever it needs to do to promote and advance Singapore’s interests, he added.
“It’s not about balancing between the two superpowers, but it’s about being consistent and principled in advancing and promoting Singapore’s interests.”
If Singapore continues to do this in a “consistent and principled manner”, its partners – US, China and other countries – will see it as a reliable and trusted partner, said Mr Wong.
Continue reading...