US, China can’t let trade issues poison ties: PM Lee
THE United States and China should not let a lack of agreement on trade boil over into other aspects of cooperation, Prime Minister Lee Hsien Loong said on Tuesday (Nov 6).
Trade issues between the superpowers are “genuine” and leaders of the two countries need to make decisions to resolve any conflict, Mr Lee said at a dinner dialogue at the Bloomberg New Economy Forum moderated by Bloomberg Editor-inchief John Micklethwait.
Global trade issues need to be addressed or it could risk erupting into broader conflicts, said Mr Lee.
“Both sides must want to reach a deal and then it can be worked out,” Mr Lee said, adding that the countries were reported to have been close to agreements which later faltered at the “top level.”
US President Donald Trump’s move to put tariffs on US$250 billion (S$343.5 billion) of Chinese goods in a bid to rebalance global trade has led to retaliation from Beijing and exacerbated a raft of disputes, from human rights to US military support for the democratically-run island of Taiwan.
While Mr Trump has floated the possibility of a deal when he meets China’s President Xi Jinping in the coming weeks, they remain far apart on market access and government support for state-run enterprises.
“The trade issues are genuine ones,” said Mr Lee.
Mr Lee was asked at the dialogue by a member of the audience what he would advise Mr Xi and Mr Trump to do on the trade war if he were at the same table as them.
“I would be very hesitant to be at such a table,” he said to laughter from the 400 guests at Fullerton Bay Hotel.
But he added: “The leaders of the two countries have to decide what they want to do, and if it cannot be worked out, then I think you really want to keep it from boiling over, respond in a restrained way and try to keep things going and prevent this from poisoning the overall relationship.
“Because even between America and China, there are so many things where you have to work together, otherwise you are not going to get anywhere, starting with North Korea.”
Chinese Vice President Wang Qishan -- a long-time ally of Mr Xi -- told the forum earlier on Tuesday that Beijing remained ready to discuss solutions to its trade war with the US.
Mr Wang also warned that China wouldn’t again be “bullied and oppressed by imperialist powers,” underscoring fears by business and political leaders on hand that rising nationalism in both countries would be harder to manage.
Mr Trump has vacillated between optimistic and cautious assessments of a possible deal with China. He set up a call with Mr Xi on Thursday, the first between the leaders in six months. On Monday, he said the trade conflict with China could still go either way.
“The trade deficit is on Mr Trump’s mind but the economists will tell you that trade deficit is a manifestation of macroeconomic problems and not a matter of trade restraints or lack of trade openness,” Mr Lee said. “That has to be dealt with separately.”
The American president has this year targeted allies and adversaries alike, threatening tariffs on all of China’s exports, proposing levies on European car-makers and saying he could leave the World Trade Organization, which he has described as “unfair.”
During the 45-minute dialogue, Mr Micklethwait also asked Mr Lee whether he was concerned about the big power rivalries spreading over into the region and affecting Singapore’s ties with her neighbours, in particular with Malaysia and Indonesia.
“Neighbours are never without complexities,” said PM Lee, adding to laughter in the audience that even the US and Canada have “interesting conversations”.
“This is what God gave us… We don’t choose our neighbours and we are blessed with two bigger than us, and we get on well with them,” he said, referring to Malaysia and Indonesia.
“There will always be issues which come up and we will have to deal with them in a way which is constructive, win-win and respects the core interests of both countries.”
Moving on to Singapore, Mr Micklethwait asked Mr Lee if the Republic’s marking of its bicentennial next year would be a good reason to bring forward the general election due by April 2021.
Mr Lee replied: “It’s always possible. There are many reasons to bring elections forward or not. So we’ll see.”
Mr Micklethwait then asked whether the job of governing the country has become harder over the course of PM Lee’s 14 years in office so far.
Mr Lee replied that it has become more complicated because of social media and fake news, where opinions can become crystallised overnight that may not be based on facts.
“And suddenly you’re having to react to that. It’s ridiculous. One night you go to sleep, all is well, the next morning, somebody’s over-reacted to a rumour. Hundreds of thousands of people have become agitated and then you got to chase your tail to put it away.”
Mr Lee cautioned that this will have implications for long-term planning.
“It will certainly leave you less time to think what your long-term intentions will be,” he said.
“It also makes it harder for you to get people to focus on the long term and to believe that in fact you have a workable scheme to get from here to there because every day you are chasing a new rabbit.” – Agencies
Mr Lee said if the US and China cannot work it out, they will need to keep tensions from boiling over and respond in a restrained way so as not to poison their overall relationship. Photo: Bloomberg