US-China tit-for-tat threatens global prosperity: Lee Hsien Loong

US-China tit-for-tat threatens global prosperity: Lee Hsien Loong

Trade tensions between the US and China hurt business and their unilateral, “tit-for-tat” actions undermine the multilateral trading system - thus threatening global prosperity, especially for smaller countries like Singapore, said Prime Minister Lee Hsien Loong on Wednesday (May 16).

SINGAPORE: Trade tensions between the US and China hurt business and their unilateral, “tit-for-tat” actions undermine the multilateral trading system - thus threatening global prosperity, especially for smaller countries like Singapore, said Prime Minister Lee Hsien Loong on Wednesday (May 16).

Speaking in Parliament, Mr Lee described how globalisation has come under pressure, with Western countries in particular “questioning the benefits of openness and free trade”.

He said the American administration under President Donald Trump now feels “that other countries are benefitting more from the global system, and at the expense of the US”.

“They want to make sure that the US will always benefit directly – item by item, country by country,” said Mr Lee.

Trade has emerged as a top issue for the US and especially in wider relations with China, he noted.

“The US is still stronger, especially militarily, but China is growing in power, influence and confidence … If there is mutual distrust and rivalry between the two, it is but a small step from a trade disagreement to a wider and more serious quarrel,” said Mr Lee. “The US and China are far from going to war with each other, but it is not clear which way their relations will tilt.

“If they tilt towards more conflict, it will be bad not only for the two powers, but for the rest of the world as well ... But if relations tilt to the other extreme, and the two powers agree to divide up the world between them, and set rules that only benefit them, that would be just as detrimental, especially for small countries which have no say.”

He added: “As a small and open country, Singapore will always be vulnerable to what happens around us. As Mr Lee Kuan Yew used to say: ‘When elephants fight, the grass suffers, but when they make love, the grass suffers also’.

“Therefore, we must be aware of what's happening around us, and prepare ourselves for changes and surprises.”

“FOR A MORE PEACEFUL, PROSPEROUS REGION”

Mr Lee also acknowledged the “momentous” and “historic change” that took place across the Causeway, with Malaysia’s opposition - led by Mahathir Mohamad - wresting government control from the Barisan Nasional coalition for the first time ever.

“As Malaysia’s closest neighbour, we need to pay close attention to our relationship with them,” he commented. “We hope Malaysia is stable and prosperous.

“We have enjoyed good relations with Malaysia under the former prime minister Najib Razak, and cooperated on major projects that benefit both sides. We have also worked with Dr Mahathir and several of his team before. We completed joint projects with Malaysia when Dr Mahathir was last the prime minister, including building the Second Link at Tuas.

"I also know Anwar Ibrahim well, because he was my counterpart when I was deputy prime minister."

Said Mr Lee: “The expectations of the new Malaysian government are very high, and I think Dr Mahathir will be very busy in the days to come. But I plan to visit him on Saturday, and tell him I look forward to working with him again for mutual benefit."

He also spoke in anticipation of upcoming elections in Indonesia, pointing out his “good working relations” with both current president Joko Widodo as well as his predecessor Susilo Bambang Yudhoyono.

“I hope we can maintain friendly and productive ties with Indonesia too,” said Mr Lee. “Regardless of political cycles and electoral outcomes, we will work hard on relations with our two neighbours. Their success makes for a more peaceful and prosperous region, and this is good for us.”

Source: CNA/jo

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