Review of Foreign Policy 2018

Mr Deputy Speaker, thank you for giving me the opportunity to address Parliament. This has been a very busy year for Singapore on the foreign and global stage. Prime Minister Lee, who by the way has just returned from the Asia-Pacific Economic Cooperation (APEC) meeting, suggested that I address Parliament because after all, foreign policy begins at home. It is essential that all of us are privy to all the activities that we have been conducting, and I will be happy to take questions from Parliamentarians after this Statement.

We have witnessed – in fact, we are witnessing – a global order in very rapid transition. It is marked by big superpower rivalry, rising protectionist sentiment, xenophobia and, in the midst of all this, an ongoing technological digital revolution. As a small country, we have to respond, and we have to respond nimbly in a very volatile global environment, we have to make ourselves relevant to all powers big and small, and we have to enlarge, to the maximum extent, the political and economic space for all Singaporeans. To this end, Singapore has worked very hard to make progress on several diplomatic and economic initiatives, and we have redoubled our efforts to support a rules-based world order and also to buttress the international trading system. This year also happened to be the year that Singapore chaired ASEAN, and we had, therefore, to host a large number of regional and international events. I want to thank all those who have been working so tirelessly over the past year, and especially our staff from the Civil Service, entire Government as well as the private sector and, of course, our fellow Singaporeans. Without this whole-of-Nation effort, we could not have achieved all that we have achieved this year.

Let me start with the Association of Southeast Asian Nations (ASEAN) Chairmanship which we just concluded last week with a series of Leaders' Summits, including all the ASEAN Leaders, that is, 10 of them. As well as them, we also had Leaders from the United States (US), Russia, China, India, Japan, the Republic of Korea (ROK), Australia, New Zealand, Canada and Chile. Twenty Leaders present in Singapore last week. In addition to that, we also had Ms Christine Lagarde, Managing Director of the International Monetary Fund (IMF). We sought to strengthen ASEAN's Unity and Centrality and, in particular, to turn challenges, existential challenges into opportunities. And that is why, during this year, when we were ASEAN Chair, we focused especially on enhancing ASEAN Centrality, unity and coherence; second, to accelerate ASEAN's economic integration; and third, on equipping people throughout ASEAN with the skills needed for new jobs in the digital revolution.

Members can see that actually we have focused very much obviously within Singapore on SkillsFuture. But in fact, this is a need in all countries – skills for new jobs in the digital revolution. Furthermore, we have also sought to enhance interoperability of digital and trading systems within ASEAN. I have also asked the Clerk to distribute an infographic which summarises the variety of initiatives that we launched this year. Whilst it is circulating, let me continue to address all Members.

Strengthening a rules-based world order has been key to regional security and peace. In fact, it is this post-World War II liberal economic global environment and adherence to a rules-based multilateral system that have given us peace for 70 years. And, in particular, created enormous opportunities for a tiny "red dot" like Singapore. So, this remains a constant focus for the Ministry of Foreign Affairs (MFA). More specifically, this year, under ASEAN, we finalised the Model ASEAN Extradition Treaty, and work will soon begin on an ASEAN Extradition Treaty. In addition, the ASEAN Defence Ministers adopted the Guidelines for Air Military Encounters. These are the world’s first multilateral guidelines to manage unintended encounters between military aircraft. This will make for a safer and more secure aviation environment in our region.

Terrorism and cyberattacks are, unfortunately, a clear and present danger. We enhanced regional counter-terrorism cooperation through the "Resilience, Response and Recovery" Framework and we also held a Symposium on a Collective Approach to Counter-Terrorism. ASEAN, for the first time, adopted a Leaders’ Statement on Cybersecurity Cooperation at the 32nd ASEAN Summit in April this year, and Singapore announced the ASEAN-Singapore Cybersecurity Centre for Excellence in September this year.

In August, we completed our three-year term as the ASEAN-China Country Coordinator. A key milestone of these three years was the formulation of a Single Draft Negotiating Text for the Code of Conduct in the South China Sea. Members will appreciate that this is, in fact, a very sensitive and very difficult issue that we have been grappling with for many years. And not just us because, in fact, we are not a claimant state, but four ASEAN members are claimant states that have overlapping claims with China. Fortunately, we have witnessed patient, meticulous diplomacy and all the parties involved – China and ASEAN – have been able to lower temperatures, and we have been able to work constructively. We also brokered an ASEAN consensus on an ASEAN-China Maritime Exercise after nearly three years of discussions, and we co-directed this exercise with China last month.

On the economic front, ASEAN has stood against the tide of protectionism. We made substantial progress on the negotiations for the Regional Comprehensive Economic Partnership (RCEP). RCEP includes the 10 ASEAN countries and includes the other six which are China, Japan, ROK, India, Australia and New Zealand. ASEAN Leaders committed to conclude the RCEP in 2019, next year. We emphasised closer economic integration through agreements on the ASEAN Single Window, the ASEAN-wide Self-Certification scheme and the ASEAN E-Commerce scheme. Without getting into the details, the point is that these initiatives will facilitate cross-border flows of goods and services within ASEAN, especially as businesses increasingly go digital, and this will ultimately enhance intra-ASEAN trade and opportunities for small and medium enterprises (SMEs) to service the expanding consumer market in ASEAN.

We established our flagship project, the ASEAN Smart Cities Network. This network will create a common framework for smart city development and the mutual exchange of action plans. The network will also connect cities with external private sector partners which will enable us to co-develop solutions for sustainable urbanisation, and members will appreciate that sustainable urbanisation is another mega-trend of our time. Collectively, these efforts will ensure that ASEAN remains vibrant, dynamic, relevant and will create bountiful opportunities for our businesses and our citizens.

We have also contributed to regional humanitarian assistance and disaster relief efforts. And perhaps at this juncture, I should say a few words about the humanitarian situation in Rakhine State.

I visited both Bangladesh and Myanmar earlier this month, and I also made a trip to the refugee camps in Cox's Bazar. This was shortly after both countries had announced their intention to commence the process of repatriating a first wave of refugees. I must say that, based on my own observations at the camp, the Bangladesh government has actually done a really admirable job of providing humanitarian assistance for a very large number of refugees in a very short order of time. But having said that, having also visited the camps, the current situation is unsustainable. As long as the refugees remain in the camps, and have no jobs and means of livelihood, they will have no future prospects. Therefore, we have to welcome the fact that both Myanmar and Bangladesh are engaged in direct, detailed discussions on making preparations for the commencement of repatriations. This is a critical first step. It is not a complete solution and there are many, many details that still need to be sorted out. Nevertheless, we do need to witness the commencement of a process and to make sure it is done in a way that provides for the refugees to return in a safe, secure and dignified way.

The situation in Rakhine State is of concern to all ASEAN member states. At the 33rd ASEAN Summit last week, all ASEAN Leaders discussed how ASEAN can support the efforts of both Myanmar and Bangladesh for the safe, voluntary return of refugees. We welcomed Myanmar’s commitment to ensure the safety and security of all communities in Rakhine State. Myanmar has invited the ASEAN Coordinating Centre for Humanitarian Assistance on disaster management to despatch a needs assessment team to Rakhine State in order to facilitate the repatriation, and ASEAN has agreed to do so. ASEAN stands ready to support efforts by all parties to address the root causes of the situation in the Rakhine State. Fundamentally, race, language, religion continue to remain live issues in our region and, indeed, across the world. Ultimately, it is the responsibility of the Myanmar government and its respective stakeholders to find a viable and durable long-term political solution. And as I have said before in this Chamber, we cannot expect quick fixes.

Twenty-eighteen has also been about bringing ASEAN to our young people. For instance, we organised the first-ever ASEAN E-sports and music festival, we renewed the Singapore-ASEAN Youth Fund, and we launched the ASEAN Youth Fellowship. These schemes provide for shared experiences of sportsmanship, community service and entrepreneurship, and we hope that this will spur more youths to get involved in ASEAN activities and strengthen our ASEAN Community and, ultimately, even more important, to strengthen the ASEAN identity amongst young people across Southeast Asia.

Our Chairmanship this year has been a whole-of-nation effort and it involves, as I said earlier, all Government agencies, our media, universities, think tanks, the private sector and the non-government organisations (NGOs). ASEAN has given us a collective platform to improve the lives of our citizens, and make our voices heard on the world stage. Post-2018, Singapore will continue to play the role of "Shepherd" for the ASEAN Smart Cities Network, and we will continue to bring new ideas to the table. There is still much more that ASEAN can achieve, and we will work with our counterparts to build a more united, resilient and innovative ASEAN in the years to come. ASEAN remains a cornerstone of our foreign policy.

Let me now move on to areas beyond ASEAN.

First, our standing as a trusted partner on a global level. There were at least two events which reaffirmed our reputation as an impartial, reliable and capable partner.

The first was the Summit between US President Donald Trump and the Democratic People's Republic of Korea (DPRK) leader Kim Jong Un on 12 June this year. Much has been said about the Summit, and I do not want to go through all that again. But the point I want to drive home is this: that we are a small country, but we can be counted on to deliver when necessary. We did not volunteer to host the Summit between the US and DPRK, but we were asked by both sides, and when we were asked, we could not say no. And so, we are proud that it went well, and that we had played a small part in easing tensions on the Korean Peninsula.

In fact, if Members just cast your minds back a year ago, the situation was extremely tense, rife with fiery rhetoric and provocative actions. Today, things are much calmer. And we hope that, given time and further negotiations and constructive diplomacy, there will be sustained peace and stability, and a fully denuclearised Korean Peninsula. Our region, and indeed the world, will be much better off for it.

Another event that I want to highlight more recently is the Bloomberg New Economy Forum. Members may be aware that, in fact, China was originally supposed to host this Forum, but when that did not materialise, Bloomberg had to relocate the event very, very urgently. Singapore again was their obvious choice. So, over two days in the first week of November, we witnessed the arrival of global business and political leaders gathered in Singapore to discuss the challenges confronting the world economy and possible solutions. The Bloomberg founder and former New York City Mayor Michael Bloomberg, Chinese Vice President Wang Qishan, and former US Secretary of State Henry Kissinger were all in town in that week. They joined some of the many other luminaries who came to attend the Forum. We were happy to be able to facilitate and to participate in these important discussions. And it is in our interest to add value and to make ourselves relevant to the global business community.

Overall, both these major events enabled us to raise our standing in the world and fly our flag high.

Let me now turn to relations with our immediate neighbours, in a sense, an update. With Malaysia, we have had a positive momentum of high-level exchanges with the new Pakatan Harapan government. We just hosted Prime Minister Mahathir to an Official Visit last week, and our leaders will meet again next year for the annual Leaders' Retreat. My Cabinet colleagues and I have built good rapport with our new Malaysian counterparts. Malaysia has a new, diverse and lively Cabinet – in fact, their ages range from 25 to 93 and I think that is a world record – but we do share many aspirations and challenges. And I can speak certainly for the younger Ministers, both in Singapore and Malaysia, that there is good rapport, there is good communication, we are all on Whatsapp and various other digital means of communication. This sometimes raises concern amongst the staff. But I can assure Members that we are not revealing state secrets! But nevertheless, that ability to communicate instantly, quickly and appropriately helps to build trust.

Issues will inevitably arise from time to time in our relations, and we will seek constructive ways to resolve them, while firmly protecting our national interests. On fundamental issues, and one key fundamental issue is the 1962 Water Agreement. On this case, our position is clear, consistent and has been articulated on many occasions, including in the Prime Minister's National Day Rally speech and, in fact, in my own Parliamentary Statement in July this year. On Pedra Branca, we welcomed Malaysia's decision to discontinue their applications for both a revision and interpretation of the International Court of Justice's original 2008 Judgment. I am glad that both sides followed due legal process and put the matter to rest. On the High Speed Rail (HSR) project, we reached an agreement with Malaysia to suspend the construction of the HSR up till 31 May 2020. The significance of that date is that it will be exactly two years from when the new government took over in Malaysia. We did so in a spirit of bilateral cooperation and goodwill and, at the same time, protected our interests and rights under the Bilateral Agreement. Overall, the outcome was balanced and reflected both countries' commitment to uphold agreements and to advance bilateral cooperation.

With Indonesia, our relations are in good shape, underpinned by the robust and expanding economic cooperation, for example, in projects like the Kendal Industrial Park in Central Java and the Nongsa Digital Park in Batam, which, in fact, I launched with Foreign Minister Retno Marsudi in March this year.

The highlight of the year was the Singapore-Indonesia Leaders' Retreat in Bali last month. This was, in fact, the Prime Minister's third Retreat with President Joko Widodo. At the Retreat, we signed a Bilateral Investment Treaty and six other agreements across a diverse range of sectors, including tourism, the digital economy and culture. Our Leaders also announced a bilateral agreement between the Monetary Authority of Singapore (MAS) and the central bank of Indonesia, and this bilateral agreement has since been signed. This bilateral agreement provides for a US$10 billion package, that comprises a local currency swap and a US dollar repurchase agreement to support monetary and financial stability, and to strengthen investor confidence in our region. These agreements reflect our belief that Indonesia's economic fundamentals are strong and that Indonesia is a large and dynamic market, with many opportunities for Singapore businesses.

Another initiative announced at the Retreat was the "RISING Fellowship". This is a fellowship scheme to deepen ties between Singaporean and Indonesian regional leaders. We wish Indonesia smooth elections in I believe April next year and look forward to continuing our mutually beneficial cooperation with them.

In 2018, we also reaffirmed our special and longstanding relationship with Brunei. In fact, President Halimah made her first State Visit to Brunei in May 2018 at the invitation of His Majesty the Sultan. Earlier this month, we also welcomed His Royal Highness Crown Prince Billah and a delegation of Bruneian Ministers for the sixth edition of the Young Leaders’ Programme. This is a key programme that enables the younger leaders on both sides to deepen personal ties and enhance trust and confidence.

Let me now turn to our relations with the major powers. Let us start with China.

This year is, in fact, an especially significant year for Singapore-China relations. It is the 40th anniversary of Mr Deng Xiaoping's visit to Singapore on 12 November 1978. Both sides have maintained a steady cadence of high-level exchanges. This year, Prime Minister Lee, Deputy Prime Minister Teo and Deputy Prime Minister Tharman have all visited China; whilst on their side, Premier Li Keqiang, Vice President Wang Qishan and Vice Premier Han Zheng have also visited Singapore in recent months.

We continue to build on our deep and substantive cooperation with China. During Premier Li’s visit last week, we substantially, and I make that point, substantially upgraded the Singapore-China Free Trade Agreement. This will enhance bilateral economic cooperation between China and Singapore. We have also made good progress on all three Government-to-Government projects, the Suzhou Industrial Park, the Tianjin Eco-City and the Chongqing Connectivity Initiative (CCI). In fact, there is a new acronym in town. CCI now has a New International Land Sea Trade Corridor (ILSTC). This was formerly called the Southern Transport Corridor. The CCI-ILSTC connects the overland Silk Road Economic Belt with the 21st Century Maritime Silk Road. It will enhance infrastructure connectivity and commerce within China, and between China and Southeast Asia. In fact, one of the reasons for the name change – and this suggestion came from China – was to make the point that they are talking about bilateral two-way flow of goods and services between China and Southeast Asia, and obviously we are at the heart of Southeast Asia and, from there, to connect to the rest of the Maritime Silk Road.

Cooperation on the Belt and Road Initiative is a new highlight of our bilateral cooperation. It has progressed well under the four platforms. I will enumerate them. First, infrastructural connectivity; second, financial connectivity; third, opportunities for third-party collaboration; and fourth, professional services, including legal and judicial cooperation. There will be much work to pursue in the years to come. We will build on this year’s strong momentum to further enhance our bilateral cooperation with China, including at the provincial level, through the latest proposed Singapore-Shanghai Cooperation Council.

Let me now turn to the US.

Our relationship is robust. It spans defence, economic, security, education, scientific and people-to-people spheres. This year, we enjoyed a broad slate of high-level, substantive bilateral exchanges. President Trump was here in June, Vice President Mike Pence last week, and earlier in August, Secretary of State Mike Pompeo. Secretary of Defence James Mattis was here for the Shangri-La Dialogue and National Security Advisor John Bolton was here last week as well. Several Ministers, including me, have visited the US this year to meet our counterparts and engage members of Congress. The Prime Minister has spoken with President Trump on several occasions on the telephone. We have expanded bilateral collaboration in new and emerging areas, such as tax information exchange, cybersecurity, financial technology (fintech), e-commerce, infrastructure development, smart city solutions, advanced manufacturing and robotics, and technology partnerships.

The key takeaway is this. The current Administration may have a different approach to trade, but the fundamentals that undergird our longstanding relationship with the US remain strong. The US remains committed to our region, and we will continue to do more with the US Administration in the years to come.

Let me now turn to multilateral diplomacy.

At the United Nations (UN) General Assembly this year, I spoke about the crisis of confidence in multilateralism and its institutions. But I also made clear that Singapore will double down on our support for multilateralism and the rules-based global world order. In a sense, we have no choice but to subscribe to that because we will always be a small, tiny red dot, and our trade volume is more than twice our gross domestic product (GDP). So, we have no choice but to subscribe and do our best to support multilateralism, a rules-based world order and international trade. Keeping a free and open trading framework and having recourse to third-party dispute resolution mechanisms are essential for a tiny city-state like Singapore.

We have done our bit to help shape international norms on emerging new areas with transboundary impact, for instance, cybersecurity, climate change. And we have thus maintained our advocacy for Singapore's interests in international organisations, such as the UN and the World Trade Organization.

MFA has also been closely supporting the Ministry of Trade and Industry's (MTI's) efforts to advance our agenda of free trade and economic integration. Just last month, the Prime Minister signed the EU-Singapore Free Trade Agreement (FTA), and now we will have to work hard to make sure it is ratified in the European Parliament by May next year. We have also just concluded the 3rd Review of the Agreement between New Zealand and Singapore on a Closer Economic Partnership (ANZSCEP). In fact, the FTA with New Zealand was one of our first-ever bilateral FTA for both of us. So, we now look forward to signing the Singapore-New Zealand Enhanced Partnership (EP) and the upgraded ANZSCEP next year.

We have also launched the MERCOSUR-Singapore FTA negotiations in July this year. For those of you who do not know, MERCOSUR includes Argentina, Brazil, Paraguay and Uruguay. And we are also in the midst of negotiating an FTA with the Pacific Alliance. The Pacific Alliance is Chile, Colombia, Mexico and Peru. MERCOSUR and the Pacific Alliance are significant trading blocs in South America. They represent the fifth and eighth largest economies in the world. We are also having ongoing and encouraging discussions on the Eurasian Economic Union (EAEU)-Singapore FTA. Again, for those who do not know, the EAEU includes Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan. I should make a shout out to Koh Poh Koon, who has been making a lot of trips to that part of the world, which many Members may not be familiar with.

Significantly, Singapore ratified the Comprehensive and Progressive Agreement on the Trans-Pacific Partnership (CPTPP) this year. With a combined market of 500 million people, CPTPP will enter into force on 30 December this year. In fact, if Members cast your minds back to January this year, and if I told you that the TPP minus the US, the remaining 11 partners, would agree to renegotiate and conclude the CPTPP, and that we would ratify and that it would come into force on 30 December 2018, you would have thought I was being completely unrealistic. Nevertheless, this has been achieved. It will produce substantial savings and improve market access for Singapore companies.

We have also played an active and constructive role at APEC and the Group of 20 (G20). I told Members that the Prime Minister just returned last night from Papua New Guinea and we will soon be going to Argentina as well for the G20 meeting. On this trip, I will have to drag along Finance Minister Heng Swee Keat and I must tell Members, for those of you who really want to go, it will take you at least 30 hours to reach Buenos Aires and another 30 hours to come back.

So, in conclusion, Mr Deputy Speaker and Members of this House, we recognise the uncertainty and volatility in today's world. But if we look at what has been achieved this year, we do not need to be pessimistic about its outcome. Even in times of significant geopolitical turbulence, Singapore has built up that very precious asset called "trust". Trusted by our neighbours and by the international community. They trust us because they know we are straight, honest brokers. We are sticklers for international law, a rules-based world order and free trade, and we believe in the sanctity of agreements and contracts. And they also trust our competence to be able to deliver when times are short and the outcomes are urgent and important.

We will continue to be nimble to adapt, seize opportunities and to do our best. MFA will work closely with all other Ministries and agencies to keep our foreign policy balance sheet in good order. What is important – and this is a point I want to re-emphasise – is that foreign policy begins at home and we do need to maintain broad domestic support for our foreign policy. An effective foreign policy rests on this domestic consensus, a consensus built both within this House, and outside this House with fellow Singaporeans. As we commemorate our Bicentennial next year, 2019, I hope Members will continue to work as a whole-of-Nation, to build a safe, secure and prosperous home for all Singaporeans and our neighbours. Thank you all very much. [Applause.]