MEXICO CITY: Asia needs to continue to cooperate with other regions in order for it to prosper, said Prime Minister Lee Hsien Loong on Tuesday (Nov 19) during his four-day official visit to Mexico.
Speaking to about 250 Singaporean and Mexican businesses, Mr Lee said if Asia closes in on itself, it "won’t starve but will miss out on many opportunities" and Asia would "be poorer for it, and so (would) the world".
He was responding to comments that Singapore’s transition over the past 50 years into a successful strategic hub got a lot of credit for shifting the centre of gravity for economic and political power in the world.
"What really shifted the world is China," Mr Lee said.
"When they decided to open up, Deng Xiaoping in 1978 embarked on reform and opening up, and the economy took off, dramatically. That transformed the global strategic landscape."
It allowed other Asian countries to benefit from China's opportunities and growing prosperity.
"So if you look at the 21st century, people used to say it’s the Asian century. I think the Asian economy will grow as a percentage of the global economy because China is still growing faster than the developed countries," the Prime Minister said.
"India is also growing somewhat faster than developed countries and potentially could grow even faster, but their politics is more complicated.
"So I think the centre of mass will continue to shift but I do not believe that Asia will be the centre of the world. Because in order to prosper, Asia needs markets, needs cooperation, needs technology with the Americans, with the Europeans, with other regions."
Mr Lee told the business leaders that "we do not want a world in which Asian countries look only to other Asian countries".
"We have a lot of business with China, a lot of business with India, but we have previously had and still have a lot of business with the United States, and a substantial amount with the Central and Latin American countries," the Prime Minister said.
“In Central America, in Mexico, in Latin America, with Brazil and other countries, and we think that is important - not just quantitatively but also in terms of how it shapes our world view - that we see opportunities around the world, that we want to do business with other advanced economies which have a lot to offer."
The Prime Minister added: "There are investment opportunities in Asia for (Mexican) companies. There are investment opportunities here in Mexico for Asian companies."
Accompanying Mr Lee is a business delegation, who will meet their counterparts during the trip.
"A WIN-WIN GAME"
Asked for his thoughts on US-China relations, Mr Lee said it was something Singapore was "worried about".
He said the US would have to choose whether to try and develop a relationship with China and its growing influence, or take a defensive approach.
“If the response is a defensive one, I think that can only lead to a very troubled relationship and it’s an effort that cannot succeed. Because, as the Chinese say, 'We are growing, you can hit us, you can’t kill us, you can hurt us. But the person who hits us, will also hurt.'
"And if both sides understand that, then however difficult it is, there’s some chance that you can work together and develop a relationship which would have competition, but there’s a substantial area where you cooperate with one another and benefit from that mutually.”
American investments are "critical" and their multinational companies play a big role in the economy, but China has bigger export markets, the Prime Minister added.
For many countries caught between the US and China, it would be "a difficult choice to make", and most would prefer not to choose sides, Mr Lee said.
He also noted that many countries across the world want to cooperate not just bilaterally, but also in wider groupings. He said this was evident after the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) went ahead without the US.
“And that was a very important signal that countries do want to cooperate with one another, more than on a bilateral one-on-one basis - and furthermore - on a win-win basis, so that it’s not just an exercise in arm wrestling, my arm is stronger than your arm," Mr Lee explained.
"Because this is not a win-loss game, this is a win-win game. And if you can come together, then there are joint gains which we can mutually benefit from.”
Singapore is currently negotiating the Regional Comprehensive Economic Partnership with ASEAN and their five Free Trade Agreement (FTA) partners, as well as the Pacific Alliance-Singapore FTA that involves Chile, Peru, Mexico and Colombia.
Mr Lee said he hopes to close the Pacific Alliance-Singapore FTA by the end of the year.