Bangkok – Prime Minister Lee Hsien Loong said during the 34th Association of Southeast Asian Nations (ASEAN) Summit on June 23 (Sunday) that Singapore “must expect some fallout” from the ongoing trade dispute between the US and China.
PM Lee told reporters that the economy is already expected to slow down as a result of the trade war between the two world superpowers.
“All of us are going to be negatively impacted if those ties turn sour,” said PM Lee.” “And I think there is a high degree of recognition of that and a great desire that third countries don’t become collateral damage if there’s friction or worse between the big powers.”
He noted that growth forecasts have dropped from 3.1 per cent in 2018 to between 1.5 and 2.5 per cent this year. The risks on the economy, according to surveys, include the escalating global trade protectionism spearheaded by the two hegemons, a slowdown in China, and a global economic downturn.
“You can see that our exports have been affected,” said the prime minister. “Factories are seeing their orders down, and their mood is significantly dampened.”
To address the issue, he said, “What we can do is to keep on focusing on upgrading and training and restructuring of the economy so that we have the productive capability and the potential to pick up again when external conditions improve.”
“And to make the best of the conditions as they are now,” he added.
The Prime Minister answered a few more wide-ranging topics during the interview such as the ASEAN Association comprised of Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam picking sides on the trade issues.
“On the trade issues side, I don’t think the ASEAN members are taking sides, one way or the other,” said PM Lee.
“They just want this to be resolved in a way which will enable global economic cooperation to take place, and regional economic integration to take place,” he added.
What the leaders are more worried about are the repercussions.
“I think all of the leaders talked about this. They’re worried about the fallout.”
The members might be “too small right now,” if standing alone, however, PM Lee commented on the power of their voice if united collectively.
RCEP and COC agreement
On the Regional Comprehensive Economic Partnership (RCEP) and the South China Sea Code of Conduct (COC), PM Lee said it was all about consensus and the sorting out of contentious issues, respectively.
“The ASEAN members are fully focused on this (RCEP), and the degree of consensus amongst the ASEAN ten is quite high. But you have to get the partner countries, that means Northeast Asia, India, Australia, New Zealand also to settle the deal because it’s a package,” said the prime minister. “We will try our best. But they are bigger economies than us in many cases, and they have their considerations.”
The COC’s contentious issues would be difficult to resolve, admitted the prime minister.
“While we are proceeding with all seriousness and dispatch, we also have to watch the content of the COC,” he said.
“And there are some issues in the COC which are going to be very difficult to work out in their nature they will be contentious. The rules, for example, and the scope of it. I don’t think we could compromise on the content,” he added.
“We have to make sure to preserve our right of interest. And I think our right of interest will not be easy to reconcile.” -/TISG