Singaporean Prime Minister Lee Hsien Loong yesterday identified economic
woes in Europe and the US, rising nationalism, and the shift in the strategic
balance from the West to the East as the three "critical risks"
facing the world today.
That meant Singapore had to
prepare itself for the future, one in which constant change and the rise of
Asia will play a big part.
"Global and Asian forces are
constantly at play here," he said. "Our survival depends on our
living the Global-Asia story - connecting Asia to the world, and vice
versa."
Lee was speaking at a dinner for
the inaugural Singapore Summit, gathering over 300 advisers and friends of the
Monetary Authority of Singapore, the Economic Development Board, the Government
of Singapore Investment Corporation and Temasek.
Held at the Shangri-La Hotel, the
three-day conference is themed "Global-Asia Confluence" and is
chaired by former Cabinet minister George Yeo. Speakers lined up include former
Australian prime minister John Howard and World Trade Organisation (WTO) director-general
Pascal Lamy.
In his speech, PM Lee took a
broad look at the state of global affairs and what it means for Singapore.
While the past two decades have seen change, excitement and opportunities, the
road ahead might not be as smooth, he said.
"It is tempting to assume
that all this will just continue, and the future will be a linear extrapolation
of the past. But history is never so predictable. The world and Asia are now at
a crossroads."
Lee then highlighted three risks
in particular, with the first stemming from the economic troubles dogging
Europe and the United States. These may drag down global prosperity and
threaten openness in the long term. "Governments are under increasing
political pressure to become protectionist. If the advanced economies close up,
it is going to have a big impact on the rest of the world, and particularly on
Asia," he said.
The WTO's Lamy made a similar
point in an interview with The Straits Times. The trade body was monitoring
creeping protectionism among some of its members, he said, as he warned of
slower global growth resulting from Europe's economic woes.
The WTO has forecast the global
economy to grow only 2.5 per cent this year, down sharply from its April
forecast of 3.7 per cent, which Lamy described as "a pretty severe
downgrading".
The other two risks Lee
pinpointed come from Asia itself.
One is rising nationalism, which
could lead to tensions and conflict. Lee noted that pride in economic success
has sharpened old territorial disputes, including those between Japan and
Korea, China and some Asean countries, and China and Japan.
The other is the change in
strategic balance stemming from a strengthening China, which is affecting
US-China relations.
If all these risks materialise,
said the prime minister, the world will be in for a rough ride.
Meanwhile, Singapore needs to do
its best to adapt, he noted, listing four things it needs to do: Become a
springboard for companies venturing into and out of Asia, embrace globalisation
while strengthening itself to cope with risks, master technology to raise
productivity and adapt to rapid social changes brought about by the growth of
social media.
On the last, he said there was
"no magic formula" for dealing with it, and the style of governance
and politics needs to evolve.
"We need to make it work
functionally, which the examples of other countries show is not so easy. And we
can keep Singapore a special place to live, work and play at the crossroads of
Asia and the world," he said.
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