SM Goh Chok Tong's interview with China News Service on the occasion of the 60th anniversary of the People’s Republic of China

China News Service: Senior Minister Goh, as an old friend of the Chinese people, what are your comments on the achievements of the new China for these 60 years? Who is your favourite leader among the Chinese leaders since the founding of the new China? And why?

SM Goh Chok Tong: The transformation of China is extraordinary. I first visited your country in 1971 when I was working for Neptune Orient Lines, Singapore’s national shipping line. The Cultural Revolution was raging. Never did I imagine then that China would embrace a market economy from 1978 and achieve so much in so short a time. I have since visited China many times. Each time, I left impressed by the new urban landscape, the skyscrapers, the wide motorways, and obvious signs of a higher standard of living. The greater change is in the mindset of the people towards modernisation based on market principles.

I do not have a favourite Chinese leader. China's leaders belonged to different historical periods and different phases of China’s development. But of the leaders I have met, I was most impressed by Mr Deng Xiaoping. I met him twice, once in Singapore and once in Beijing. He had a good historical grasp of events and a sweeping view of China’s future. He thought in terms of 50 or even 100 years ahead in solving his country’s problems. But he was also extremely down-to-earth and decisive. He opened China to the outside world and brought about the transformation of the country.

CNS: Senior Minister Goh, what successful experiences and practices do you think China has adopted or learned from Singapore, if you look at the achievements since the founding of the new China, especially in the recent 30 years of reform?

SM Goh: When Mr Deng Xiaoping came to Singapore in 1978, he saw first-hand what the southern Chinese who had settled here had achieved. He felt that if Singapore could achieve such progress, so could China with its much bigger population. Following his visit, Singapore was held up as a model for China’s development. China sent Party cadres and government officials to learn the reasons behind Singapore’s success.

To impart the software of Singapore’s development, both sides agreed on a large scale concrete project – the Suzhou Industrial Park, which celebrated its 15th anniversary this year. The Park emphasised the discipline of master planning, the importance of consistency in implementing policies and the need for international standards of modern management and corporate governance. It also introduced a workers’ provident fund based on Singapore’s Central Provident Fund model.

Human resource development is a key pillar in our bilateral cooperation. We have tailored our programmes for Chinese participants to fit China's needs and requirements. For example, we have customised courses to focus on urban planning and development, social development, and tackling corruption, which are some of the key concerns for China today. Chinese officials have learnt very quickly and adapted Singapore’s experiences to China's national conditions.

Today, while China still finds that there are lessons to learn from Singapore, it is not a one-way flow anymore. As China develops, there is also much that Singapore can learn from China. I foresee many opportunities for Singapore and China to work together and learn from one another in the years to come.

CNS: China has faced the contradictory problem between economic development and environmental protection in the process of its reform and opening up. Senior Minister Goh, what successful experience do you think is worthwhile for China to learn or use as a reference fromSingapore in this aspect? Could you please discuss the successful experience in Singapore of eliminating the gap between the poor and the rich?

SM Goh: It is crucial to maintain sustainable development as a country grows and develops. As China's economy continues to grow at a high rate, it has to address the rising costs of growth, such as environmental damage, regional developmental disparities, the urban-rural disparity and the widening income gap between the rich and the poor.

Sustainable development is a major priority for Singapore, as we are a small, densely populated city state with no hinterland and are heavily dependent on imports for most of our resource needs. This means developing in a way that allows us to give our current and future generations both good jobs and a good living environment.

Growing the economy and preserving the environment are not mutually exclusive goals. On the contrary, they are complementary. A strong economy provides Singapore with resources to protect and improve the environment; while a clean environment improves the quality of life, and helps Singapore to attract and retain more talent. This in turn contributes to the Singapore economy, thus forming a virtuous cycle.

In Singapore, we adopted three broad principles of sustainable development, in order to build a dynamic economy, while ensuring a high quality living environment.

First, we do long-term, integrated land-use planning. We look 40-50 years ahead, integrating processes to achieve the desired economic, social and environmental outcomes.

Second, we take a pragmatic and cost-effective approach. We recognise the need for growth, but with stringent environmental standards and investment in environmental infrastructure. We choose the most cost-effective options, bearing in mind that short term costs may be necessary to generate long-term benefits.

Finally, we take a flexible approach. We testbed new technologies so that we have the capacity to exercise different options in future when they become cost-effective.

The Singapore River and Kallang Basin clean-up in the 1980s is a good example of Singapore’s successful experience in balancing economic growth and environmental protection. In the 1950s, due to port-related activities along the Singapore and Kallang rivers, waste products such as oil and sewage were discharged directly into the rivers, resulting in the rivers becoming extremely polluted by the 1960s. The smell then was terrible! The fishes disappeared. I had personal experience of the stench as my office then was by theSingapore River.

We undertook a comprehensive clean-up programme, which was successfully completed in 1987. Port-related activities and street hawkers were relocated away from the river; the river bed a Kallang Basin was dredged; squatters along the river were offered resettlement and compensation; and the areas around the riverbanks were improved and landscaped.

Today, the river flows smoothly, fishes have returned to the river, and the banks have been transformed into attractive riverside walkways and landscaped parks. Today, the river hosts a wide variety of activities – ranging from waterfront dining and river taxis to sporting events and arts performances. Cleaning up the river increased the economic value of the area and taught Singaporeans to take responsibility for the cleanliness of our waterways.

Singapore’s readiness to share its experience in sustainable development within a clean and green environment was the reason behind my proposal to Premier Wen Jiabao to build an ecologically-friendly city in Tianjin. Work on the Tianjin Eco-city is now in progress.

The income divide is a challenge that all market economies face. China and Singapore are no exceptions. It cannot be eliminated. In fact, in a globalised world, the divide will probably continue to widen. Top talent and skills are in demand in every country and they are globally mobile. If you want to retain top talent, you will need to pay top dollars. If you want entrepreneurs and businessmen to create jobs, you must give them the freedom to make money for themselves. But the government can take steps to ensure that economic growth is inclusive, and no community is left behind. We provide good, affordable housing, efficient public transport, good education and healthcare and lifelong learning and skills-training for workers. We make sure that even low income earners enjoy a comfortable standard of living. Through sound policies, we generate budgetary surpluses. And we distribute some of these surpluses in a targeted way, with more going to the lower income group. This year, we introduced a new scheme called the Workfare Income Supplement. It is a wage supplement scheme for the very low income workers — a form of negative income tax.

CNS: Now, on the situation of the global economical recession and in the shadow of the financial crisis, what functions do you think China could exert in Asia, especially in the regional cooperation of ASEAN? Could you please describe the future for Singapore-China cooperation to cope with the crisis?

SM Goh: I encourage Asian countries to continue to work closely together and take pro-active steps to promote the recovery of their economies.

ASEAN enjoys a strong economic relationship with China. China is ASEAN’s 4th largest trading and investment partner, just behind the US, the EU and Japan. ASEAN's relationship with China has been strengthened by the conclusion of the ASEAN-China FTA, which was ASEAN's first FTA negotiation with a Dialogue Partner.

We see the recently completed ASEAN-China Free Trade Area (ACFTA) as a sign of China’s strong commitment to liberalise its economy and facilitate trade with ASEAN member states. This is an important development that will benefit all of us. The ACFTA effectively creates a free trade area of over 1.9 billion people, with a combined GDP of almost US$6 trillion. There is tremendous potential in leveraging on closer cooperation between the two sides as we deal with the current economic challenges and prepare for the eventual global economic upturn.

We can work together in ASEAN and multilateral fora such as the WTO and APEC to mitigate the impact of the economic crisis. We can strengthen economic integration, resist protectionism and support the multilateral trading system.

Bilaterally, Singapore also enjoys a long history of economic cooperation with China. China is todaySingapore’s third largest trading partner, after Malaysia and the European Union, as well as our top investment destination. Through increased trade and investments, we not only create opportunities for companies from both our economies, but also help to foster growth beyond the immediate downturn.

In 2009, Singapore’s bilateral relations with China reached a new milestone with the entry into force of the China-Singapore Free Trade Agreement (CSFTA). This is the first comprehensive bilateral FTA that China had concluded with an Asian country. The CSFTA has reduced barriers to trade and created new opportunities for businesses from both countries.

CNS: Finally, Senior Minister Goh, could you please talk about the future for Singapore-China cooperation in education and culture, as well as your views on future investment cooperation between Singapore and China?

SM Goh: Let me first talk about bilateral investment cooperation, which has been very strong. Today, China is the top investment destination for Singapore companies. As of end-2008, Singapore companies had invested a cumulative US$38 billion in China. Singapore companies have had a long history of operating in China and are in a wide range of sectors ranging from manufacturing, property development, transport and logistics and environmental engineering, to banking and finance, healthcare and education. They have diversified their presence from the coastal regions – which were the first to open their doors to foreign investors – to inland regions such as Western China, Central China and the Northeast.

China continues to be an exciting market for Singapore companies, with many opportunities for win-win partnerships. As China’s economy continues to develop and grow, new areas for cooperation will emerge. One key area, given the increasing pace of urbanisation in China, is in “urban solutions”. For example, there is scope for the two countries to work closely on integrated township development and environment management. Many Singapore companies have strengths in these areas as they have participated in Singapore’s own development.

We have encouraged our companies to band together to take on larger projects in China. By amalgamating their strengths, our companies would be able to execute more complex projects than they are individually able to. In addition, Singapore has also set up business councils with seven provinces, namely Shandong, Sichuan, Liaoning, Tianjin, Jiangsu, Zhejiang and Guangdong. These business councils provide government oversight and facilitation for Singapore companies’ investments and interests in the respective provinces.

At the same time, as more Chinese enterprises look to internationalise their operations, I believe they will see value in using Singapore as a base from which to expand and extend their reach. Chinese companies with HQs and other activities in Singapore can leverage on our network of FTAs, connectivity with other economies, as well as efficient capital markets. More than 2,650 Chinese companies have already established their presence in Singapore. Out of these, some 150 companies have listed on the Singapore Stock Exchange. I have full confidence that Singapore and China will continue to find win-win investment opportunities that benefit our economies and companies.

On education cooperation, there have been regular exchanges of visits at the political level, and extensive education collaborations between the two countries at both the school and higher education levels. About 70% of schools in Singapore have established twinning programmes with schools in China. Activities conducted under such twinning programmes include visits, sports activities and exchanges of students and teachers. For example, Singapore’s Hwa Chong Institution has established a Satellite Campus with its partner school, No. 2 High School attached to Beijing University, to provide longer immersions for students from Singapore to learn more about Chinese language and culture. At the higher education levels, our universities have strong ties with PRC universities, including joint degrees, joint research, as well as staff and student exchanges. These student exchanges will bring about greater mutual understanding between younger generations of Singaporeans and Chinese.

At the official level, the Memorandum of Understanding between our Ministries of Education, which was renewed in April 2009 when Chinese State Councillor Liu Yandong and Education Minister Zhou Ji visited Singapore, provides an important platform for the two countries to deepen and broaden education relations. We are also very happy that Singapore's new fourth state university will be established in partnership with the Massachusetts Institute of Technology from the US and a top university from the PRC. Such a tripartite collaboration model provides ample opportunities for cross-fertilisation of ideas and exchanges among faculty members and students.

Singapore’s cultural agencies also regularly engage their Chinese counterparts across various platforms. For example, in the performing arts, the Esplanade, our premier arts venue, frequently features a strong Chinese line-up at its festivals. The Singapore Arts Festival in May this year featured Chinese director Zhao Hua’s interpretation of “The Cherry Orchard”. In the visual arts, the Singapore Art Museum works closely with museums in China to facilitate exhibitions by artists of both countries. The Asian Civilisations Museum also worked with the Beijing Palace Museum to organise an exhibition about the Kangxi Emperor earlier this year, which was very well-received in Singapore.