Nothing in CECA implies Singapore must unconditionally let in PMEs from India: Ong Ye Kung
SINGAPORE: There is “nothing” in the Comprehensive Economic Cooperation Agreement (CECA) that implies Singapore must let in professionals, managers and executives (PMEs) from India unconditionally, said Health Minister Ong Ye Kung on Tuesday (Jul 6).
He added that contrary to claims made by the Progress Singapore Party (PSP), Singapore’s ability to impose requirements for immigration and work passes “has never been in question” in CECA or any other free trade agreements (FTAs) that the country has signed.
Mr Ong was speaking in a ministerial statement aimed at dispelling “false allegations” surrounding CECA and laying out the importance of trade pacts for Singapore.
This is not the first time that the Government has come out to debunk misperceptions about CECA, a bilateral agreement with India signed in 2005.
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The minister noted that even before last year’s General Election, the PSP had made repeated allegations about how CECA allows professionals from India “a free hand” to come and work in Singapore.
This includes a recent social media post by Mr Leong Mun Wai, a Non-Constituency Member of Parliament (NCMP) from PSP, who said that “most important economic policies that have affected the jobs and livelihoods of Singaporeans relate to Foreign PMETs and Free Trade Agreements, in particular the Comprehensive Economic Cooperation Agreement (CECA) with India”.
“These statements are false. They have been repeated for too long,” Mr Ong said in Parliament.
Noting that he was a former trade negotiator who worked on several of Singapore’s trade agreements, he added: “I owe a duty to correct the falsehoods.”
“FALSEHOODS” ABOUT CECA
Attempting to clarify the “so many falsehoods” surrounding immigration matters, Mr Ong pointed to Chapter 9 under CECA, titled “Movement of Natural Persons”.
The chapter, he said, “makes it clear that the Government’s ability to regulate immigration and foreign manpower is not affected” by the trade pact.
The Government also “retains full rights to decide who can enter the country to live, to work or become permanent residents or citizens, he added, citing the second and third paragraphs found within the chapter.
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In addition, the obligations relating to the chapter are “not broad principles with wide applications, but highly specific”, like all FTAs.
Mr Ong raised the example of National Treatment as one broad principle which can be found in some chapters of FTAs, like Trade in Services or Investments. This means that one country cannot discriminate against foreign service providers and investors.
“If immigration had not been carved out and if the National Treatment principle had been incorporated into the Chapter 9 of CECA, then indeed, Indian workers would have been treated like Singaporeans, and would have had free rein to come to live and work in Singapore,” he said. “This is what the PSP claims.”
“Except that there is a strong immigration carve out and National Treatment is not found in Chapter 9 of CECA, nor any other corresponding chapter in the FTAs that Singapore has entered into.”
The minister emphasised: “Nothing in this agreement implies Singapore must unconditionally let in PMEs from India.”
Instead, the obligation that Chapter 9 imposes on both countries is to “process applications for temporary entry with some expedition and a certain transparency”, such as informing applicants of the outcomes.
Singapore also has “to accord a certain duration for the validity of the permits”, but these applications are subject to prevailing work pass conditions, he added.
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Such a commitment on duration is not something unique to CECA, said Mr Ong, noting similar commitments in other FTAs and in the World Trade Organization Agreement that is signed by 164 parties including Singapore.
Many parties to FTAs also commit not to impose labour market tests - a “common clause” in Singapore’s FTAs including those with India, Australia, China and the United States.
“It means we do not insist that companies go through onerous processes and documentation to prove that no suitable locals will take a job before they can hire a foreigner. Companies in Singapore do not hire in this way.
“The common and best practice is to interview the suitable candidates, consider them all fairly, and make a judgement on the best person,” he said, noting that these are “market-friendly, widely adopted, reasonable obligations”.
Mr Ong went on to highlight two aspects of Chapter 9 that “has been singled out for criticism”.
First, he said the PSP has pointed to a list of 127 categories of professionals under CECA and claimed that Indian nationals in these professions can come to work in Singapore freely for one year.
“This is false,” he said, given that all foreign PMEs have to meet existing work pass conditions.
Mr Ong explained that the list shows the types of Indian professionals who may apply to work in Singapore and it “does not mean we must approve”.
“India, for its own reasons, requested for such a list, similar to what they have in their FTAs with Korea and Japan. In fact, even if they had not listed the professions, their PMEs could still submit work pass applications to work here,” said Mr Ong, adding that the point being made by PSP “is a red herring”.
“The list does not confer any free pass to any Indian nationals.”
In full: Ong Ye Kung addresses 'false' statements on FTAs, Singapore-India CECA in Parliament
The second common criticism is that intra-corporate transferees from India are able to freely enter Singapore to work. This is also untrue, said Mr Ong, as they also have meet existing work pass qualifying criteria.
He went on to say that the total number of intra-corporate transferees from all over the world, not just India, that have come to Singapore to work is “very small”.
Last year, there were only about 500 intra-corporate transferees from India in Singapore, less than 0.3 per cent of all Employment Pass (EP) holders.
“So, Mr Speaker Sir, I hope we can put a stop to all this misinformation about our FTAs in general, and CECA in particular.”
Mr Ong acknowledged the challenges faced by PMEs in Singapore, although he stressed that FTAs should not be seen as the cause for these issues.
"Indeed, Singaporean PMEs, like PMEs in other advanced economies, are facing challenges. Many have given us their feedback and the Government has been taking steps to address their concerns.
"But our FTAs in general, and CECA in particular, are not the causes of the challenges our PMEs face," he said. "If anything, they are part of the solution."
“FTAs and CECA have been made political scapegoats to discredit the policy of the PAP Government," added the minister.
One challenge faced by local workers is the competition from foreign PMEs, said Mr Ong, noting an increase in EP holders which has grown by 112,000, or an annual growth rate of just under 7 per cent, from 2005 to 2020.
But over this period, the number of local PMEs has increased at a much higher rate, with an increase of more than 380,000.
These numbers underline that competition between foreign and local PMEs is “not a zero-sum game”, Mr Ong said, noting that “the converse is often true”.
“By combining and complementing local and foreign expertise, we can attract more investments and create many more good job and career choices for Singaporeans.”
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Foreign PMEs have also helped to cushion the impact on the local workforce during a downturn. For the 12 months to April 2021, the number of EP holders dropped by about 21,600 and S Pass holders fell by about 26,800.
Another challenge raised by Mr Ong is the profile of the foreign PMEs which “are concentrated in certain sectors and from certain countries of origin”.
He noted that as Singapore’s digital economy and need for tech talent grew, more PMEs from India have come to Singapore through the EP framework.
“And when that concentration happens in areas such as Changi Business Park, some may feel that we have lost a part of Singapore. Members of the House have raised this concern. We are taking this seriously and studying what we can do to lessen this problem.
“I hasten to add that dealing with excessive concentration is not a straight-forward matter of chopping up the operations of a company here,” he added.
"We don’t want to unintentionally cause the whole investment to move elsewhere. This will hurt even more Singaporeans."
Another challenge is the occurrence of some unfair hiring practices at the company level, he said, adding that abuses of the system will occur and authorities must tackle these abuses swiftly.
“I have explained the underlying reasons for the difficulties faced by our PMEs so that we know what it means for us in terms of public policy choices, and how we can most effectively address the challenges,” he said.
“If we mistakenly blame FTAs and CECA for these problems, our responses would be disastrously wrong and would make our problems worse.”
Prime Minister Lee Hsien Loong echoed Mr Ong's point, while acknowledging the anxiety faced by Singaporeans about jobs, foreign competition and the impact of "large numbers of foreigners working and living" in Singapore.
In a Facebook post on Tuesday evening, Mr Lee said these are "valid concerns" that the Government will address.
"But if we put the blame on CECA, that will not solve our problem but instead make it worse."
BE WARY OF RISE OF XENOPHOBIA
Mr Ong said given how the country’s FTA strategy has benefited Singaporeans and Singapore, it is “disappointing that FTAs are now a target of political attack” although this has also emerged in other democracies around the world, such as the US and UK.
But Singapore needs to be "careful that these valid concerns are not exploited by political groups, and intentionally or not, end up sowing division, stoking fear, and fanning hatred", he added.
“As representatives of the people, we all have a responsibility to realise that our words and deeds can shape public opinion and the direction of our political discourse."
He pointed to an earlier debate between Mr Leong and then-Minister for Communications and Information S Iswaran after the former made a point about DBS Bank not having a "homegrown" chief executive.
“I agree with Minister Iswaran, and feel that Members of the House should be very careful about what we say on such matters, if we are not to give credence to a very negative, even ugly, minority view."
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"That is also why we appreciated the Leader of the Opposition standing up to say that when it comes to racism and xenophobia, we have to all reject them and there can be no ‘ifs and buts’ about it."
Rounding up his speech, Mr Ong said he decided to make the ministerial statement on Tuesday so that the House can approach the debate on the PSP’s subsequent motion on CECA with "the right perspective and motivation".
"This House should continue to debate robustly the pros and cons of various policies to help Singapore navigate the balance between global and local. But we must not inadvertently shake the bedrock that has enabled Singapore to succeed," he said.
"We cannot survive, we cannot earn a living without being connected to the world, and without being welcoming to the world, without the House unanimously supporting our FTA strategy."