PM Lee Hsien Loong at the Bloomberg New Economy Forum 2021

John Micklethwait (Moderator): Prime Minister, thank you very much for having us here as Mike said. Thank you for putting up with us. Thank you for putting up with me again. 

PM Lee Hsien Loong: Thank you for coming and thank you for doing the dialogue again. It is our fourth or fifth. 

Mr Micklethwait: I think we will begin with the international scene and come to COVID-19 and Singapore precisely. Just to begin, China and the US, earlier this year or late last year, you called for a truce. I wondered does the past week where we have seen the deal at COP about climate change and we have now seen Xi and Biden talk. Does that amount to the truce that you asked for? 

PM Lee: I think it is a necessary beginning. The differences between the two countries are many and deep. It goes beyond individual issues to basic mindsets. They are not going to be resolved or reconciled in one meeting or one deal. But it is good that the US and China could make some understanding at COP26. It was crucial for the two leaders to be able to have this virtual meeting and speak frankly to one another. 

Mr Micklethwait: How would you describe these two different mindsets? What is the fundamental difference as you see it? 

PM Lee: The two see the world in very different ways, and see each other in very different ways. For the Americans, it has become a bipartisan and very strong consensus that China is not just a potential threat, but a challenger and a serious problem for them, an opponent almost. I am not saying that the administration thinks like this, but I think it is the broad view in American society, at least the think tankers. 

At the same time, the relationship with China is not just contesting strategic balance which needs to be worked out, but has a moral dimension to it – right and wrong, I am democracy, you are not, I am human rights, you are not. If you define issues like this, it becomes very difficult to transition from that to saying I have to co-exist, we both live in the same globe.

On the Chinese side, I think there is a very settled view now amongst many of their journalists and population, I imagined some of the leaders too, that America wants to slow them down and stop their emergence, and America regrets having helped them, given them permanent MFN (Most-favoured-nation), allowed them into the WTO, facilitated investment growth and made them now where there are.

Secondly, there is the sense that China’s time has come, and we shall take our rightful place in the world, which is quite understandable. But then, how do you take your rightful place in the world in such a way that a very big player leaves space for many not quite so big players. That is a sensitivity and an art which does not come naturally. 

Mr Micklethwait: That problematic mindset you described, does it also involve China’s time has come and America’s is going? 

PM Lee: Yes, there is that part as well. There is a strong sense that the East is rising and the West is declining. In particular, that America is a declining power. I think it is wrong. I can see what makes them think like that. Other people sometimes think like that. But if you take a long view, you really have to bet on America recovering from whatever things it does to itself. 

Mr Micklethwait: Can we look at one of those things it is doing to itself at the moment? We heard from Gina Raimondo earlier at the conference. She is out here, selling very eloquently, the US Indo-Pacific Economic Framework. It is a trade deal without a trade deal. It does not have the trade deal at the back of it. I suspect that people like Singapore would much rather that the TPP, now called the CPTPP, was back. America is trying to sell something that is hard for your to naturally gravitate towards. 

PM Lee: These are the realities of politics. The TPP would have been the ideal approach. It took America some time to come to that. To decide that this was the way it wanted to engage the region, and to push for this flagship substantial project, which would not only show but actually be a deepening of America's engagement and relationship with Asia.

Mr Obama personally adopted it. He put a lot of time pushing the leaders and making the negotiations make progress. But I think what he did not do, or judge that it was not possible to do, was to push it enough domestically and in Congress. In the end, he ran out of time and it was not possible to smuggle it through a lame duck Congress. Anyway, Hillary (Clinton) also disavowed it, and when Mr Trump won, that was the end of the matter. And you are now in the position that it is dead. I am not saying it can't be resurrected, but resurrection doesn’t happen after three days or three years either.

So therefore, what does America do if you cannot do that. Well, you still need to be able to engage with a substantive agenda and if I cannot do that, I can talk about digital co-operation, green cooperation, human resource co-operation. One piece is missing, but at least I am not missing from the field of being engaged. 

Mr Micklethwait: You are very compassionately talking about it from the perspective of a seller when you are actually the buyer. You are the person who has to decide whether this is a good or bad. Do you still think it is something that is useful? 

PM Lee: It can be useful. We are pitching the idea of a Digital Economy Agreement (DEA) with the US, with some grouping of the APEC economies. We hope the US will participate in this. (It is) not so easy for a Democrat administration to do, because the administration has come in promising to look after the middle class in the US and everything needs to link back to that. Actually, everything will ultimately link back to that but if you insist on a direct and immediate connection, you may miss out on many indirect but valuable project such as this one. 

Mr Micklethwait: China is now applying to join the CPTPP. So is Taiwan. How do you assess the chances of either of those or both of those joining in? 

PM Lee: Well, the way that CPTPP was constructed was that it would welcome anybody who would come along and meet its quite high standards and the spirit thereof. When China expressed an interest, with a TPP, the idea was we have this grouping, one day it is conceivable China would be interested and it is more likely that you can have a deal between the US and China in the TPP framework than the US and China bilaterally make an FTA. I think both sides were coming around to considering that. Even the Chinese who initially poo-pooed this, and this was meant to fix us, then they decided to study it. They think about these things for a long time and eventually said that perhaps we should take an interest in it. Unfortunately, the Americans are not there now.

From the point of view of economics, I think it can make sense. From the point of view of process, the decisions are made by consensus by all the CPTPP members and when they look at it, it is not just economics which they will look at, but they will also consider the political considerations, the strategic and the security factors, and also any bilateral issues and concerns which they may have been discussing.  

Mr Micklethwait: And the South China Sea could become part of it….  

PM Lee: The South China Sea is not a trade issue but there are also trade issues between the APEC economies or the CPTPP countries and China. I hope they can work it out. In the long term it is good to have more trade rather than less trade. I still believe that although it is not so fashionable now. I hope these things can be worked out in a way which enhance the stability and integration of nations. 

Mr Micklethwait: Singapore has always been a great benefactor or beneficiary of multilateralism. What was interesting this morning was that we had Wang Qishan giving an address and he probably mentioned the word multilateral and multilateralism about twenty times. This new China, coming towards you and bearing gifts, promising that it is multilateralist. Do you believe in that? 

PM Lee: I think it is the right thing for them to say and the right thing for them to try to do. I mean if China came along and said, I am a unilateralist, you would take it amiss. They claimed to be a multilateralist, they do want to join all these organisations. In fact, they would like to vote some of their people lead these organisations. There have been some UN organisations where fierce contests have taken place. And they would like to influence the rules in these organisations, all of which is legitimate because they are a considerable power and they want to have commensurate influence in the world. Question is, how do you make it truly multilateral after a very major power has joined the group. In principle, the five principles of coexistence as big or small, we are all equal, but in practice in the UN, everybody knows that some countries are more equal than others. 

Mr Micklethwait: It could be an elephant in the room, so to speak. It could be much bigger than all the other partners. 

PM Lee: Yes, and you have to engage the power and the power also has to have some self-awareness that this is the way I operate, which will ensure my acceptance and therefore a continuation of my influence without resorting to brute force. 

Mr Micklethwait: Has China yet reached that point of thinking that way, in a way that you could imagine them sitting beside you treating everyone as somewhat equal? 

PM Lee: Well, no big power treats everyone as somewhat equal, but some do so better than others. 

Mr Micklethwait: They do it more politely. 

PM Lee: No, I would not say more politely. Look at the Americans, they have been in Asia Pacific since the war, at least, they were in the Philippines even before that. But to be after 70 to 80 years, still welcomed in a region and not just be seen as an ugly American, it tells you that there is something about this. 

Mr Micklethwait: What would it say about America’s role in the region if China joins CPTPP and they do not? 

PM Lee: Well, if China joins CPTPP, America still has a role in the region. You have investments, trade, interest, friends and allies here. We hope that amidst the many far-flung preoccupations around the world, you have the time to cultivate a part of the world which may not squeak so loudly but which is a valuable and profitable relationship. 

Mr Micklethwait: If you were Joe Biden, what would you do to change that balance? It sounds from everything you have said that America needs to do slightly more in this region than it is doing so far. 

PM Lee: First, I would try to move on trade. You cannot do an FTA but you do want to move forward on trade even despite democratic party rules. Secondly, to develop the relationship with China, because if that relationship is sour it is much harder for every country in the region. Thirdly, do not stop with China, also cultivate your other friends in the region and allies. The second part Biden is trying to do. It is a long journey but he is starting. Friends and allies, his approach is quite clear and I think people do believe that. The last thing he can do is to ensure the President after 2024, whichever party, (is) of like mind.

That is sadly, not within his giving, but that is something which is very important. You must be able to look beyond because America’s interests extend well beyond 2024. 

Mr Micklethwait: One last question on that, is Taiwan. How much should we worry about what is going to happen there? 

PM Lee: I think we should be concerned. I do not think it is going to war overnight, but it is a situation where you can have a mishap or a miscalculation and be in a very delicate situation. The countries all say the right things. In this virtual summit this morning, Joe Biden said, US will uphold its One China policy and he also talked about the Taiwan Relations Act which is longstanding. Xi Jinping said we are not in a hurry to solve the cross-straits problem. It is a code word, but everyone knows what it means. In Taiwan, Dr Tsai Ing-Wen says we ask everybody to maintain the status quo. So, everyone says the right thing, but if you look at what is happening, it is not a static situation. The US has significantly increased the visibility, the level and the intensity of diplomatic and even military engagements with Taiwan. 

PM Lee: China has been testing Taiwan's air defences. It flies airplanes to Taiwan’s air defense identification zone (ADIZ) almost daily. It does not intrude into its immediate air space, but it is testing Taiwan’s defences and tightening up on international space, which it was prepared to concede Taiwan even five or several years ago. On the part of Taiwan, this DPP administration has disavowed the 1992 Consensus, which was to each its own interpretation, and says no, that is not an acceptable formulation, and taking other steps. For example, printing on their passports, in English, ‘Taiwan passport‘.

All these moves raise suspicions, tensions and anxieties, and makes it more likely that a mishap or miscalculation can happen. And really, you want to step back some - deescalate is too strong a word – chill, a little bit, and think how much you would regret losing this if you tried the alternative which came. 

Mr Micklethwait: Do you really think China feels that way? Do you think it would, surely if the alternative, is it controlling Taiwan?  

PM Lee: No, I think that if they were quite clear that the situation was stable and things would not gradually drift against them, they would be more relaxed about taking time to see how things evolve. But the difficulty is, if they fear that things may be drifting away from them, not away from them economically, because economically, I think they are going to become more and more a big factor in Taiwan’s economy. But in terms of the attitude of the people in Taiwan. In terms of the international environment. Well then, they may decide that perhaps later may become more complicated. So, I do not think it is a matter where they want to solve it straight away. But how do I deal with a very difficult problem? I mean, they have got Hong Kong, it is already a very difficult problem. 

Mr Micklethwait: Hong Kong, you mentioned it, just very quickly on that. Do you see Hong Kong as something that China will increase its authority over? There has been a tightening of restrictions. 

PM Lee: I think what was happening in Hong Kong before last year was, it was very hard to imagine that it could continue until 2047 - for 50 years. It is not possible. You cannot govern a place like that. You cannot pass the laws; the government’s writ does not run and there is the risk of contagion across the One Country, Two Systems border. So, they are now in a situation where that problem has been very firmly put down. I think that there is a price which has been paid internationally, and even internally in Hong Kong, and I think they will see how things evolve from there. I do not think they wish to, or want to make it the same as any other Chinese city. That makes it unvaluable to them because they have got many other prosperous Chinese cities. Hong Kong is different, that is why it was valuable. But how different can it be without posing an intolerable problem on the other side of One Country, Two Systems. That was the difficulty. 

Mr Micklethwait: How much is Hong Kong’s loss, Singapore’s gain? 

PM Lee: I suppose some people may decide they prefer to be in one place than the other, but overall, I have no doubt that Singapore is much better off if Hong Kong is prospering and we do business with them and compete with them. 

Mr Micklethwait: Sounds a bit like Paris talking about London at the moment. 

PM Lee: It certainly does not sound like London talking about Paris. 

Mr Micklethwait: There are similarities. Can we look, turn a little bit towards Singapore and COVID-19. We have all lived through this, we have all lived through it the past couple of days. You said in October that you would relax, or think about relaxing restrictions in three to six months, roughly. On that timescale, the earliest would be January. It is worth reminding the audience here that in Singapore, generally, people are living under tighter restrictions than we have very generously removed for this conference. People are only allowed to meet two at a time and things like that. Is January still a goal? 

PM Lee: We have to see how things evolve. It is possible. The thing is this, we are trying to reach the end point without paying the high price which many other societies have paid, which got infected before they got vaccinated. We kept COVID-19 very low in Singapore until we had everybody vaccinated. We had hoped that after nearly everybody got vaccinated then you have herd immunity and theoretically, well, life goes back to normal. But with the Delta variant, you may have everybody vaccinated and you still have quite a lot of people getting infected, which for most people who are young is fine but for a significant proportion of the old who are not vaccinated… 

Mr Micklethwait: You have 60,000 people… 

PM Lee: I have 61,000 people who are 60 and above who are not yet jabbed. 

Mr Micklethwait: They refuse to take it? 

PM Lee: No, I do not think they are refusing. They are coming, every day, a couple of hundreds still come. Some of them are very infirmed and perhaps bedridden, we go and jab them if they are willing and their families are willing. Some of them their families may have reservations about whether their constitution can take it, but we tell them we are not sure their constitution can take COVID-19. They are anxious, we understand that. Some of them say, “mRNA is it safe? I am so old”. Well alright, so now we have got some non-mRNA vaccines on the menu, they can do that if they want to. Gradually, we will cover them. But because of our strategy, we have not had the very big outbreaks that the British or many of the European countries or the Americans have had, and I am now at a point where I have had most of the population vaccinated, but most of the population is COVID-19-naïve, and it turns out that is not enough, and we are having COVID-19 spread in our population everyday – today there are about 3,000 cases, probably times three if you count those which we did not see. Over a period of months, those numbers will build up and if you have been vaccinated and then infected mildly after that, I think your chances of being sick again are much less. And COVID-19 will, I hope, spread less virulently and we can progressively ease up. What I am trying to do is to ease up a little bit, make sure things stabilise, ease up a bit more, make sure things stabilise again and ease up a little bit more, and eventually it probably will not be back to status quo ante but close enough, and without having had to make unsettling u-turns. If I have Freedom Day and after three weeks cases flare up and I have to tighten up, it is very upsetting to the population. It is confusing, they will be frustrated, disappointed and you may well pay a price along the way, human price. So, I think it is better we take it step by step. I am not absolutely certain that I can do this without any misstep, I may have to step on the brakes again from time to time, but that is my game plan. 

Mr Micklethwait: Is this not the problem of governments all the way around the world? You are, by most measures, a very trusted government, but basically, you face this problem between sending a clear message and then the fact that the message has to change. 

PM Lee: Yes, that is a problem, because with COVID-19 the science changes, the virus changes, the situation changes. You keep on finding yourself in a new situation and each time you think you are at the end of the road, another hill appears ahead of you. And you have got to keep people energised, motivated and believing that yes, it is worth making this journey – we will get there. 

So, what does it mean? I think first, it means you should do your duty. Do what is right, do what you judge necessary, consult the doctors, consult the public health people, judge the political and the social outcome you want in terms of the balance – healthcare, economy, social cohesion. Make the decision and let the opinion polls go hang. It is your job to see the country through.

Secondly, when things change, you will have to change along with it, because if you cannot change along with it you will be out of step, and that is very hard. We started off with COVID-19 zero practically, meaning I see a case I will stamp on it, and if I need to trace 200 or 500 people to do that, I will try to do that. Not quite like in China where one case means one city locked down, but quite stringently. Now I am not doing that. Now I am saying let the cases go but let us keep the vulnerable people safe. 

Mr Micklethwait: You do not worry those 61,000 people are driving the whole policy that Singapore could open up more? 

PM Lee: Well, but those 61,000 people have more than 61,000 relatives and friends, and near and dear ones. If you just write them off, I do not think you can make those utilitarian calculations. It is a human cost. Just look at what has happened in Britain or in Italy or in America. Sometimes, it is by policy. Sometimes, it is by accident. But the terrible trauma that society goes through – you have people who are sick, whom you cannot treat, who die waiting for oxygen or waiting for a bed – I would much rather not to have to do that. 

Mr Micklethwait: You mentioned China. China is almost the outlier now. You had a group of countries, Singapore, Australia, and New Zealand who took a very strong, and as you pointed out, a very successful approach to stamping out COVID-19. 

PM Lee: But we had no choice in the long term. Right from the beginning, I told our people we cannot keep our borders closed indefinitely because we make a living from doing business with the world. If people cannot travel to Singapore, if goods cannot ship through Singapore, we are dead. 

Mr Micklethwait: But China is now very much saying we are going to keep things… 

PM Lee: But China is 1.4 billion people. I have five and a half million. They can make domestic tourism forever and not exhaust their destinations. 

Mr Micklethwait: They do not have to have cruises. You have cruises, rather wonderfully cruises to nowhere.

PM Lee: I can only cruise to nowhere.

Mr Micklethwait: Least for the uninitiated. The remarkable thing where you get on a cruise ship and you go off, look at a few tankers and then come back.

PM Lee: Well, in the old days, they did not look at a few tankers. They went down to the casino and had a good time. 

Mr Micklethwait: China is actually being quite rude implicitly about you, Australia, and New Zealand, saying you are opening up too quickly. 

PM Lee: We are in different situations. In the long term, I do not know how it will turn out for China because they can maintain this for some time, but this virus is a very contagious one and very difficult to manage, as we have all found. For now, it is working for them. It is their judgement.

For us, we have had to change course, and we have had to carry the population along and persuade people that it is necessary for us now to accept the few thousand cases a day. We will try our best but there will be casualties and there will be mainly old people who will not make it through. It is just the way life is and it is the way influenza and pneumonia and other diseases carry off old folks by the thousands every year. We accept that and we have to manage this going forward without letting it go out of control.

And that is why I say trust is critical. Because finally it is not my logic which persuades people, but they watch you, they listen to you. They either have confidence in you and faith in you or they decide, well he sounds good, but I am not following him. 

Mr Micklethwait: On the cruise to nowhere, can I ask you a personal question on the end of that? You have said that you will stay on until COVID-19 is under control. You will stay on as Prime Minister. Some journalists have noted that you have however cleverly put two of your potential successes onto the COVID-19 taskforce to see how they do. It looks a little like Squid Game. Do you have any idea how are they performing? Are you thinking of eliminating them or continuing? 

PM Lee: I think our approach is not to write off any participants because I do not have spare. I am not looking for a winner. I am trying to build a team, and the team needs many different skills and many different people to carry a very heavy responsibility of taking Singapore into the next generation, beyond me and my age group of leaders.

I think each makes a contribution. I put them there not as a beauty contest, but because I think they can make a contribution and it is a very important job which needs to be done. If I do not put the best people available on the COVID-19 team, what am I doing with them? 

Mr Micklethwait: I will take that as a sign that they are still in the competition. Can we move on to the part on the inheritance, which is the economy? I wondered, you are here, you are facing rising prices. It is the big debate everywhere. We look up and we see heads of investment banks also worrying about this. Inflation, what does that mean for Singapore and how worried are you about it? 

PM Lee: So far, it has been close to zero for quite a number of years now. Sometimes, plus one, sometimes, zero, some years even negative occasionally. It looks like it is catching up now. The central bankers tell us not to worry, it is transient, that they are tapering off very gradually and then things will be alright again. But meanwhile they want to push inflation up to something which is good for them, like 2 per cent, and push inflation expectations up to 2 per cent, because then they have room to do conventional monetary policy again and the economy will work better. I hope they are right, but it is very difficult to tell about these things. In Singapore, up to now we have not seen a very high spike, like in America I think in their last number they had 5 or 6 per cent – very sharp. In our most recent forecast for the year, maybe we have one and a half or about two per cent this year, not negligible but it is a trend which needs watching. 

Mr Micklethwait: Can I ask you about two forms of taxation that you are either thinking about or started that many other countries around the world are looking at? The first is a carbon tax. If you ask most economists and business people, or I would argue most people with a brain, about the best way to deal with global warming, they will say that you should tax carbon in the same way as you tax cigarettes, alcohol and other things you want to discourage. Politicians in most countries have wimped out on that – certainly in America. You have tried a carbon tax. You got one around $5. It is not a lot and most people would say it should be higher, but what would you say to other people who are too timid to try this? 

PM Lee: I have seen other people try this and we pay the price for trying this, so I do not go around advising other people. We decided that it is the sensible way in which to incentivise people to cut back on things which cause carbon emissions – to apply a carbon tax and we wanted to apply it across the board to all major emissions. That means if you are mostly a manufacturing factory or a big plant producing a lot of carbon, we will calculate what you owe. Also, importantly, electricity plants because the gencos are running on natural gas – nearly all of them – and that generates carbon dioxide. So, we apply a carbon tax on them and it feeds through into our electricity tariffs. When it comes to petrol and diesel, we took the view that we already had an excise duty, which is substantial particularly for petrol, and so we did not add on an additional carbon tax – we just treat that as part of it. 

I think it is important to get started. If you want to incentivise change of behaviour and usage, or even industry structure in the long term, it has to be significantly higher than that in order for us to reach the carbon targets which we have set for ourselves, which is to peak at 2030 and then to go down by around half by 2050. Once I have set a cap to my carbon emissions, I must decide whom to give these emissions to. Either I charge you for them and you buy them from me, or I must make a decision to allocate – this industry has so much and that industry therefore you have so much less, and this consumer therefore if all industries have more, have even lesser. I think these choices cannot be avoided, there is only how best you can do it. I think the carbon pricing is one element. At $5 it is a token, but it cannot stay at $5 and we said that we are reviewing it. 

Mr Micklethwait: There is an interesting thing that you do here and it is that the money you raised from a carbon tax, you give back to consumers directly so they can see… 

PM Lee: We have not done that with the carbon tax. We have said that we will take the money and use that and more if necessary to incentivise carbon mitigation, reduce carbon emissions and improve your standards – that we have been willing to do. 

But in other areas we do that. For example, we charge a lot of money for water in Singapore, because it is a scarce and strategic resource. People pay the full price for water – it is now about $2.50 per cubic metre. It is affordable but nevertheless, it is a lot more than it used to be before we made this system. So what we do, rather than subsidising water or consumption, we give people what we call a U-Save voucher. In other words, it is practically cash. I put it into your utilities bill statement, so it offsets your water or electricity consumption, but if you do not use that water or electricity, the cash is basically yours. It is not so easy to explain, but I think it is the right thing to do and it has worked. 

Mr Micklethwait: Do you worry about a backlash against greenery in the same way as the one against globalisation? People thought that globalisation was something that the elites like. People now think that mitigating climate change is something that the elites support, but for most people that means more money on the utility bill, and more money on their… 

PM Lee: Yes, I think that is entirely possible. You look at the yellow vests in France, you look at what happened when the Australians tried their carbon tax several governments ago – people will react. They want to save that planet but when you tell that means you have to pay more for electricity or that means you cannot buy your SUV, you have to buy a compact. And that's a very personal implication. And if you lose your job as a result because the industry is restructured - your petrochemical plant has to disappear. I do not think they will be very comforted if you tell them that global warming will be less. 

Mr Micklethwait: The other tax that you are looking at is the wealth tax. I understand that you do not see this as a kind of temporary thing to do with COVID-19 but you see this as something structural that you want to look at taxing wealth in at least some way. 

PM Lee: I think it is an element in a comprehensive revenue system – you tax consumption, you tax income, you tax sins, and you should tax wealth, whether in the form of property ideally wealth in other forms. Now, property taxes we know how to do. Because we have them, we have refined them over the years, we have made them progressive. And they make a valuable contribution to our exchequer. Taxing wealth in other forms is very hard to do. You know in principle you want to do it. People have tried capital gains taxes – that has some downsides. People have tried other forms of direct wealth taxation – I assess how rich you are and knock off a certain percentage. It's not so easy to implement. So we will study this but we need to find a system of taxation which is progressive and which people will accept as fair. And fair means everybody needs to pay some. But if you are able to pay more, well, you should bear a larger burden of the tax. And if you are less well-off, you should enjoy a greater amount of the government's support schemes and benefits. 

Mr Micklethwait: The underlying problem in Singapore is you have been very good at dealing with income inequality. 

PM Lee: Income inequality is somewhat easier to see and measure as compared to wealth and inequality because I can track your income and our Inland Revenue Authority has become very good at studying these things. But wealth is much more difficult – you can squeeze it here and it pops out in different forms elsewhere. Nowadays, you may have a non-fungible token. How do you know? Or bitcoin. So it is not as easy to manage, but it is something which we do want to be worried about because we would like to make sure that each generation starts off from as equal a starting point as possible. It is not possible to make it exactly the same, but within the limits of my ability, I will try to equalize if your parents cannot provide everything which they need to for you. 

Mr Micklethwait: You do no worry that the wealth tax will scare away the wealthy? The wealthy tend to be fairly good at avoiding them. 

PM Lee: That is one of the worries. And that is one of the reasons why you have to think about this very carefully. Because you have an agreement on a global minimum tax for companies – I am sure your clients have a view on that. And the idea is to equalise the playing field for government so that you do not have companies playing shell games. I move my income here and there. Sometimes you see it and suddenly you do not. But I have no illusions that a 15 per cent, or 20 or 25 per cent minimum effective tax rate is going to stop governments from competing with one another to get projects which they want. And competitions will pop up in some other form, it is unavoidable. And I think if you do wealth taxes you may well come up with the same problem. 

Mr Micklethwait: If you examine the example of France which had one or two problems when it hiked up its taxes very, very high. 

PM Lee: The French have a girl who is the icon of the country, Marianne. And her face changes – because from generation to generation they will update the person who is the model, but Marianne is a symbol of France. And this is about 20 years ago but Marianne decided to live in London because the taxes were lower. 

Mr Micklethwait: I assume you will be in the same position. If I can finish in one particular theme, look forward to Singapore, as we go forward, imagine somebody wins the Squid Game, whatever it is, you are somebody looking at Singapore in 10 years’ time, how different is it? Just ask you about two bits – one is the geopolitical sense, do you see Singapore is stuck in a world with two economies or one when there is still a big global economy? 

PM Lee: I think there will be global economy, but there will be toll dates and all kinds of customs checks along the way, even swab tests. Because I do not see the rivalries disappearing. They could get worse, but neither is it possible for the Siamese twins to be separated. You are too inter-dependable on one another, and it is not possible to say I make my own system and you make yours. You may be 1,400 million people but you do not make everything in the world and you may be the most powerful superpower on earth, but you need friends and partners, and you need to do business if not on trade, on many other issues with somebody whom you might consider not fully your friend. That is unavoidable. So there will be tensions, but I hope that there will still be peace. 

Mr Micklethwait: May I ask you on a more personal level, do you think the way in which people work – this is a famous entrepreneurial world – many people have huge offices here. Do you think the way that people work, remote working all those things, has that been a long-term legacy of COVID-19? 

PM Lee: There will be some of that. I know people who work in Singapore for American companies. Their boss is in San Francisco, their people reporting to them are all over Europe. And they also have members on a team on the east coast on the US and in Canada. They have to get used to either European time zones or American time zones, so it is not that comfortable, but it is workable. And I think that we will grow, but I do not believe it is possible for you to build an organisation without ever meeting face to face and pressing flesh. You have to have a feel of the person – I meet you; I sense you, the pheromones have to be there, then you know if he is fearful, confident, what sort of person is he or she. You will need to build a sense of camaraderie and teamwork. And those companies which operate in skyscrapers will tell you that when you have different floors, the different floors form different cultures. And sometimes they make staircases to break through the floors in order to prevent these tribes from forming. To not have a tribe by being all dispersed and spectral presence in cyberspace, I think in principle is possible, but in practice it is not quite one team. 

Mr Micklethwait: One last thing, and that is your 10-year vision, what do you see yourself doing? 

PM Lee: I hope I shall not be doing this job still. Thank you. 

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