Remarks by Deputy Prime Minister and Coordinating Minister for Economic Policies Heng Swee Keat at the Hong Kong Trade Development Council Business Dinner “Singapore – Hong Kong Partnering For Success” on 24 July 2023.
Dr Peter Lam, Chairman of the Hong Kong Trade Development Council
Ladies and gentlemen,
Good evening. When I visited Hong Kong last year, Chief Executive John Lee and your colleagues received me and my delegation very warmly. We enjoyed some great food and even better conversations, including on the areas in which Singapore and Hong Kong can work closely together. So I am delighted to welcome John to Singapore, and to reciprocate your hospitality. This is your first visit here as Chief Executive, and I hope that there will be many more to come! Let me also extend a very warm welcome to the many good and old friends of Singapore whom I see among the delegation and business leaders. Building closer ties takes the collective effort of the public and private sectors. While governments can build institutional bridges, businesses catalyse trade and investment through these frameworks and create good jobs on both sides. I hope that all of you here today will take the opportunity to renew your links in Singapore and forge new ones too.
The close and longstanding friendship between Singapore and Hong Kong is anchored in the many commonalities that our two cities share. Notwithstanding our resource disadvantages, we have tapped into our entrepreneurial and innovative spirits to establish ourselves as dynamic cities and economies. Today, both Singapore and Hong Kong are international business and financial centres with excellent connectivity to the world, backed by a strong pool of professional businesses and talent. Our bilateral economic ties have remained resilient over the past few years, despite the COVID-19 pandemic and challenging global circumstances. In 2022, Hong Kong was Singapore’s fifth largest trading partner and third-largest destination for outbound investments, while Singapore was Hong Kong’s fourth largest trading partner and seventh-largest investor. Beyond trade and investment, we share multi-faceted collaborations in areas like education, FinTech, infrastructure project management and public sector staff development. Our relations are also underpinned by close people-to-people relations and high-level exchanges. These have forged greater connectivity across the public, private and people sectors, and position us well to seize new growth opportunities in a rapidly changing world.
One common advantage that Singapore and Hong Kong have is our strategic locations, both within our respective neighbourhoods, as well as within a vibrant Asian region. Asia is already home to the world’s second, third and fifth largest economies – China, Japan and India. Furthermore, ASEAN, as a regional group, is poised to become the 4th largest global economy by 2030. Asia’s prospects for growth are therefore strong. In fact, it is expected to contribute about 70% of global growth this year. And there is still more potential to be unlocked. In ASEAN today, youth account for 34% - more than one-third – of the 654 million population. This holds promise for growth in emerging areas like technology, sustainability and the digital economy. Indeed, across ASEAN, 100 million additional internet users have come online in just the past 4 years. China is also making determined efforts to grow her economy. The regional development strategy across different regions of China is an important means of coordinating economic development across a vast and diverse country.
Asia’s development potential is significant and offers immense opportunities for growth in the region. Singapore and Hong Kong are well poised to facilitate opportunities and contribute to growing the pie, by promoting stronger connectivity and collaboration between the Greater China and ASEAN regions. Hong Kong is a key gateway to China, especially following its further integration with Mainland China through the Guangdong-Hong Kong-Macao Greater Bay Area and upcoming Northern Metropolis. Dr Peter Lam also mentioned that Hong Kong is a key gateway to the Belt and Road initiative. Singapore has been welcoming investments from all over the world since our independence. In recent years, with the developments in ASEAN and other economies in Asia, our linkages with different markets have grown and diversified. Our two cities could build platforms to bridges across different economies around the world. This will contribute to the growth of our Asian region, as well as around the world.
A particularly important plank in building greater economic connectivity is deepening financial linkages. Having spent many years in financial sector supervision and development, I firmly believe that effective and efficient capital intermediation is critical to supporting economic development. So I am glad to see how financial cooperation between Hong Kong and Singapore has expanded over the years. Singapore and Hong Kong’s financial regulatory agencies work closely in areas such as financial regulation and supervision, information sharing, as well as in emerging areas of FinTech. As international financial centres anchored in Asia, Singapore and Hong Kong must continue to serve our regions well and stay ahead of new developments. Our collaborations must strengthen the robustness and transparency of the regional financial industry, which would in turn attract investments towards key areas of development in Asia, such as the green and digital economy. Singapore and Hong Kong could jointly support the development of smart and green city clusters in ASEAN and the Greater Bay Area. Both cites have deep research capabilities, strong capital, and new projects where we could develop and deploy green construction technologies and a range of sustainability solutions. Such collaborations will also position our companies well to bring their experiences and knowhow to our respective regions and beyond.
More broadly, Singapore and Hong Kong can continue to be beacons of free trade and proponents of a rules-based global trade architecture. As cities with a long history of intermediating trade, Singapore and Hong Kong have benefitted from an open and inclusive trading system. In recent years, we have witnessed significant shifts in the global operating environment. The pandemic, geopolitical tensions, and supply chain interruptions have caused many countries to turn inwards to enhance resilience. Some have also taken the opportunity to enact protectionist measures in the name of safeguarding national interests. Against this backdrop, it is imperative for like-minded economies like Singapore and Hong Kong to remain advocates of free trade and contribute towards maintaining an open and rules-based regional trade architecture. For example, the ASEAN-Hong Kong Free Trade Agreement (AHKFTA) promotes legal certainty, improves access to markets, and enhances investment opportunities for our business communities. Hong Kong has also applied to join the Regional Comprehensive Economic Partnership or RCEP, which brings together ASEAN’s FTA partners onto a single platform and reinforces the regional architecture. Singapore supports Hong Kong’s application to join the RCEP. As we continue to advocate for and preserve confidence in a rules-based global multilateral trading system, we should also establish, between ourselves, a strong foundation to catalyse collaboration, especially in new growth areas such as digital trade, and intellectual property protection and enforcement. This is how we can continue partnering each other for success, and bring benefits to our people, businesses and economies.
In summary, the long-standing partnership between Hong Kong and Singapore has benefited both sides and strengthened our roles in promoting regional and global development. Let us build on this. Chief Executive Lee’s visit to Singapore, which is also the first by a Hong Kong Chief Executive since the COVID-19 pandemic, heralds a new chapter in our longstanding and fruitful partnership. I am especially heartened to see so many Hong Kong business leaders gathered here today, representing a wide range of fields including manufacturing, logistics, aerospace and financial services. It is my firm belief that the next bound of global economic growth will come from technological breakthroughs and innovation in new areas like sustainability and digitalisation. In this regard, Singapore envisions being a Global-Asia node of technology, innovation and enterprise, to launch and scale solutions to some of the most pressing global challenges like climate change, food and water security, and the needs of an aging population. Partnerships are a critical element of catalysing such impactful solutions, and I welcome friends from Hong Kong to collaborate with us and make the most of these new growth opportunities. In this spirit, I am happy to hear that organisations in Singapore and Hong Kong have signed 7 new Memoranda of Understanding covering areas such as business promotion, Fintech, innovation and entrepreneurship, decarbonisation and research and development. Singapore looks forward to further deepening and broadening our collaborations with Hong Kong in these and other exciting new areas, as we work to enhance our partnership for success in the years ahead. I wish you a pleasant evening, and successful onward travels for Chief Executive Lee and your entire delegation. Thank you.
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