SM Lee Hsien Loong at the Chatham House Dialogue (Oct 2025)

SM Lee Hsien Loong: Thank you, Samir, happy to be back at Chatham House. The last time I was here was in 2014, more than a decade ago. And as Samir reminds me, soon after the [Russian] invasion of Crimea.

In the last 10 years, the world has changed a great deal. And the multilateral global order – led, guided, shepherded by the United States – has come a long way towards unravelling. It is something which has been underway for some time, partly because of the trade imbalances and tensions which have built up between countries. And partly also to a substantial degree, because of strategic tensions and rivalries between the US and China, as China has grown stronger, and contradictions have emerged in their relations.

It has been brewing for some time. But this last year, it has come to a boil with a new US administration. And it is something which affects all countries. Small countries – particularly Singapore – looking out at the world, anxiously trying to avoid the storm all round us; but even all other countries are trying to ask how to navigate through this storm and avoid any rogue waves hitting them unawares.

I would just say there are two areas which we can think about, and we can discuss later. First, on trade and secondly, on security.

Trade

On trade, we used to talk about Most Favoured Nation (MFN) – win-win, free trade, co-prosperity, interdependence. Now we talk about security, resilience, tit-for-tat, and a bilateral, transactional, win-lose approach – at least in some circles. Where do we go from there? I think for many countries, the direction it’s going – we have grave forebodings, and we are not sure how to make a U-turn, but we will try our best not to go in the most disastrous directions. Because whatever the difficulties, whatever the security or resilience considerations, you have to do business with each other, and we cannot go back to autarky. The best – the only example – of autarky we have is not a very encouraging one, and that is North Korea. It is not where most countries want to be.

You have to do business. How do we do business? I would say there are three things which we could do, given that a very important player, the United States, has decided that they will no longer hold the ring; they will no longer be the champion of free trade; they will no longer stand for multilateralism and MFN rules. In fact, they want to go bilaterally. They want to use trade fully weaponised as an instrument of power. And they also look askance sometimes, when other countries come together and want to promote trade and cooperation with one another. What do you do with this reality?

I would say there are three things.

First, do not give up on the WTO (World Trade Organisation). There is life in the old dog yet. It has got many shortcomings. It is ugly, it is inefficient, it cannot make decisions because consensus means unanimity, and that is paralysing. But there are things you can do within the WTO umbrella – and you do want that umbrella – because it represents a certain ideal, a certain conception of the way we should work together, which we do not wish to give up, for good reason.

So, I give you two examples of the things which you can do in a practical way. One is something which they call the JSI – Joint Statement initiative. It has to do with e-commerce, the JSI on E-Commerce^[1]. And it is a group of countries that came together, led by Singapore and Australia. It does not cover all the countries in the WTO, but a fair number of them. And we came together and agreed on a set of rules which would govern e-commerce, and which would help to promote e-commerce amongst ourselves. And well, so it is not universal. It is consensual. But these are all consenting adults. We know what we are doing, and we hope that others will want to join us. And well, if that is a contribution to the global system, that is a plus.

A more recent example, still on a very nascent scale, is what we call FIT P – the Future of Investment and Trade Partnership. It started as, I think, 14 small countries. Singapore again, there with New Zealand, with the UAE, with Switzerland, and a few other countries. And the idea is to agree amongst ourselves on broad rules for engagement when it comes to investment, to trade, to dispute resolution. So even if the WTO mechanisms do not work, we have some idea how we can work with one another and avoid ending up in a war of “all against all”. And again, if other countries would like to join, well, that is a plus.

There is some precedent for small things growing big. For example, the CPTPP – the Comprehensive and Progressive Agreement for Trans-Pacific Partnership – started off as a very small and improbable thing. Four of us: Singapore, New Zealand, Chile and Brunei. We called it the P4 and the hope was not that there was any significant volume of business, but we hoped that by creating this, it could be the nucleus around which some crystal would form. And it did form. And we negotiated, and we had Japan join the party; we had the Vietnamese join the party; we had Peru join the party; Mexico, Canada, even the United States joined the party, which really, we thought we had hit a six.

And it nearly got across the finish line. But unfortunately, Obama could not get it through Congress and did not want to try, and ran out of time. But we salvaged it, and today you have got the TPP minus the US. We call it the CPTPP. It is 11. And last year, the UK joined, and it is 12 again. And it shows that small things can grow, and it may not cover the world, but it makes a significant contribution. And I think we should work like that in the WTO.

Secondly, on trade within regions, we ought to work to enhance our own cooperation and bring down the obstacles which we have erected ourselves. Every region has these. Even the EU (European Union), which is supposed to be a single market, is not really a single market in many aspects – finance, investments, for example, regulations. And so too in Southeast Asia. We have an ASEAN (Association of South East Asian Nations), and we have a free trade agreement. But there is more we can do to bring down the obstacles to trade and integration amongst ourselves. I think you can do that with fewer of the strategic and security concerns, and it is something which is well worth doing. There is no shortage of ideas and plans the Europeans have – Mr Draghi has a very comprehensive plan published last year. And within ASEAN, we have lots of ideas too, and we hope some of them will have more legs, Now that the necessity is greater.

The third thing you can do is to link up between different regions of the world. Because the path of least resistance is to end up with regional blocs – and you have your area of influence, and I have mine – and between us, things are difficult. But you really do not want to go there, because that way leads to more friction, and I think, less prosperity. And you want to link up between blocs so that you can work together and have a network, a web which collectively encompasses the world.

So I see the EU is talking again with renewed energy, with MERCOSUR. It has been going on for a long time now, perhaps it will cross the finish line. EU is also reviving its interest talking to the ASEAN group – That also has been talking for a long time, but there is now new impetus. And it is possible for the EU to talk to the CPTPP group, which I think would be very valuable. Because on the one side you have basically a Trans-Pacific grouping – a dozen countries. On the other side, you have got the European countries. And we both have an interest in promoting trade and integration, subject to reasonable safeguards and fair trade and all that. And if those things can come to some fruition, I think that you can avoid a worst-case outcome on trade.

There is some reason for optimism. If you look at the response of countries since Liberation Day – or anyway, since the second of April – it has not descended into a war of “all against all”. Countries have been mostly quite restrained in their responses. And amongst themselves, it is quite clear that they want to preserve as much of the framework as possible, so that you do not end up mutually impoverishing each other. And if that can be held, I think that would be very valuable.

One key thing is, how do you fit China into this picture? Because they are big, they are important. You have a lot of trade with them; you may want to grow your business with them at the same time – How do you resolve the imbalances which exist with China? And how do you deal with the security in other aspects, which are particularly salient in this relationship? And that is something we can discuss later.

Security

On security, taking a Singapore perspective from Asia, I would just highlight a contrast between how it is in Europe and how it is in Asia. In both cases, we are confronted with a US policy which is radically different from what we had planned on and expected. But the situations are different. In Europe, you know pretty exactly what your strategic challenges are. You are dealing with Russia now – successor to the Soviet Union. Its situation – with a backdrop of the Cold War, and that history – very present in people's minds. And you have NATO (North Atlantic Treaty Organisation), and you have a focus – this is a security challenge; at least many countries would say it is the security threat. And you know you want to build up, strengthen capabilities, and improve your collective defence.

In Asia, that is not the picture. China is a very important player. It has developed. It has grown stronger. It is strengthening its armed forces. That is one of their Four Modernizations, and it is palpably growing more significant by the day. But most countries in Asia do not see China as a threat. Some to varying extents, do. Japan – because they have a dispute with China over the Senkaku Islands, but also because of the history of the Second World War, which still hangs over us. Australia – because they are allied to the US. And also they see the Chinese’s actions in the South China Sea as being inimical to their security interests, and they have said so. Taiwan is a special case – not a country, but it says it is watching very closely what is happening and concerned about its future. And then you have South Korea, for whom the most serious preoccupation would be North Korea, but who no doubt look beyond North Korea and ask, “Where does China stand on this?” Which is something you have to think about.

But most other countries do not take such a stance. Because we see China as a big power in the region – present, a geographical reality. They are here; we do a lot of business with them; we have prospered because they have prospered and we want to prosper more. And it started with trade. Now it is not just trade; it is also investments; it is also tourism, people flows.

And there are bilateral issues – the South China Sea. There are claimant states in the South, in the ASEAN countries, who come up against China, which is also a claimant state. But even while you have the bilateral issues, you do not frame it as an existential thing – you want to do business and you want to be able to manage the relationship. Because overall, you have many, many different tongs in the fire.

So that is very different from Europe. And to take it a little bit further, I would say, even US allies in the region want to maintain their equities with China. The Japanese have a lot of trade and investments in China. The Australians – China is their biggest export market – iron ore, coal, all sorts of things. They also sell oysters and wine. And from time to time, those get caught up in great geopolitical disputes and get held up, but they want to maintain that relationship.

And I think that gives the strategic situation in Asia a very different coloration and tone from the strategic situation in Europe. It does not mean that the countries do not want to maintain their ties with America. They do. They have always benefited from Pax Americana. They have appreciated the US’s economic presence, certainly, but also the security presence even as they have simultaneously grown their ties with China.  It was a kind of Goldilocks situation – you could have both sides of the benefit.

Now you have to make some more difficult choices. And we really do not want the US to lose interest in this and say, “Well, I am only focused on Latin America and Asia does not matter.” Asia does matter, outside China. It does mean that if Asia matters to America, they will express their preferences on how you conduct relations with other powers. And all the powers will say, “I am not asking you to choose, but I would like you to be my friend.” And we accept that. But I think for all the countries in the region – all the smaller countries in the region – we believe that it is  better to be pushed from both sides and yet have manoeuvring room and freedom of action and autonomy in a region which is open, where you have choices, where there is a balance of power, and multiple players are here. And therefore we are all, well, we do not all get everything we want, but you are able to prosper together and take the opportunities here. And that includes Europe and UK having an interest in the region, and including on security issues. Because the South China Sea is far away from you, but if you care about global trade, then these are critical lines of communications, and you have an interest in freedom of navigation around the world.  

So, we are in this situation. It is not ideal. We can find a way forward. It is much better than being left to our own devices and the world being carved up into spheres of influence, and small countries having the choice of one for their best and biggest friend.

And we hope we can sustain that. We have agency, but the outcome, well, maybe in 10 years’ time, we will know what has happened. So, thank you very much.

Moderator (Dr Samir Puri, Director, Global Governance and Security Centre, Chatham House): Senior Minister, with your opening comments, I think you have very concisely articulated your perspective and Singapore's perspective on some huge issues − some of the biggest issues facing us in International Affairs today. And it is very timely as well to have you here, because the ASEAN summit has just finished in Kuala Lumpur. Donald Trump is out on his way via Japan to the APEC summit.

SM Lee: In Korea.

Moderator: In Korea, where he may meet Xi Jinping. And there may well be some stabilisation of the US-China relationship right now, but the trend lines are still speaking towards substantial change. And I wanted to start in Singapore's region, if I may. And there are some interesting developments already this year.

Indonesia joined the BRICS partnership in January, I think, somewhat forgotten because of everything else that has been happening. Malaysia, Vietnam, Thailand, they have all expressed an interest. And I wanted to ask you, thinking ahead five, 10 years, do you think Singapore's region will be very, very different? And would you, for example, expect things like Malacca ports to be developed much more by China in Malaysia? How different do you think Singapore's region will be?

SM Lee: Well, I think that the basic shape will not have changed because it is very difficult to say how a big power will calculate its interests. But I think between America and China, there are very deep issues which are not going to disappear. There are the trade issues − they are being discussed. And I hope some arrangement can be worked out. The smoke signals seem to be encouraging.

I think they had some signs that they have reached some arrangement. And Mr Xi and Mr Trump will meet in South Korea, and something will be signed. And I think that is not a bad thing to at least take the 100% tariffs off the agenda. The more deep contradictions between the two powers, US and China, I do not think they are going to disappear.

Because the most fundamental thing is the Americans see China as a challenger. I think they call it a “pacing challenge” − somebody who is catching up with them in technology, in size, in security, in military capabilities, even in nuclear arsenal. And they are determined to stay ahead of on all, and also in things like AI. The US are determined to stay ahead by all means at its disposal, to prevent the Chinese from overtaking them.

On the other hand, the Chinese say, “Development is my right, and I want to grow. I want to progress, and my right to develop is a red line. And how can you tell me that I am not entitled to exceed you?” So, I do not see this contradiction going away because the Chinese may not be able to exceed the Americans immediately, but there is potential for them to grow bigger, stronger and more advanced. They may not grow as quickly as they did over the last few decades − decades where they had eight, nine, 10 percent growth in some years. But they will make three, four, five percent growth, and there are 1,400 million people, and they will count.

So that basic difficulty, I do not think will easily be overcome. Some modus vivendi will be necessary – because if there is no modus vivendi, and it really comes to a fight, each side can do a lot of damage to the other, and I do not think either side really wants to go there. I hope they will be able to avoid it.

Kissinger used to say, “The fight cannot be won and must not be fought.” And he is right. But whether it will not be fought, we do not know. In the region with that backdrop, I do not see the US being able to say, “I pay no interest in the region.” I mean, it is important – ASEAN has 600 million people. It has got considerable purchasing power. The middle classes are rising in Indonesia, in Thailand, Malaysia, Singapore, Vietnam, the Philippines. There are troubled spots like Myanmar, but [ASEAN] is a significant economic entity taken as a whole. And therefore, if the Chinese continue to develop − there will be investments, they may have Belt and Road projects, they may invest in ports − we hope that there will continue to be American investments, European, UK investments, and continuing links in all these different directions, and therefore a region which is open. And if we can maintain that, say, 10 years from now, then, well, let us assess there and take it the next step forward.

Moderator: And picking up these themes of navigating this particularly tumultuous period, I wanted to focus specifically on being a small state and the experience of being a small state. And just for those who do not know Singapore, if you get in a taxi at Changi Airport and you are going maybe to the other side, to NTU (Nanyang Technological University), if there is no traffic, that is only 45 minutes or so. It is a very, very, very compact place − Singapore.

And I think a lot has been said about punching above its weight, but I wanted to find out from you a bit more about what can practically be done by small states grouping together. You gave the example of the Future of Investment and Trade Partnership, for example. Do you think that it will end up being small states clustering for safety in a difficult environment, or can they actually provide a positive example that maybe gathers momentum and preserves parts of this rules-based order that you are talking about that needs to be preserved?

SM Lee: First, we, small states coming together for safety is useful. And minnows do tend to school together. And we are all minnows, some bigger than others, but it is possible that there will be bigger participants. It is possible that there will be bigger countries which think it makes sense to follow rules which work, and will join the groups and make the groups more effective, more significant, and yet without crowding out the little guys. And that is quite delicate – you want to bring in bigger players, hopefully in a balanced sort of way. So that they sort of even each other out, and there is still room in the interstices for us little guys still to continue to exist. And even if this particular initiative does not work, I hope other initiatives will come about and will provide some, at least partial, safety net for the world, for the trading system.

Moderator: It is such an interesting collection, UAE, Lichenstein and a few others, New Zealand, Switzerland. And let us move on to security because you focused on that in your opening comments. And you rightly distinguish the security challenges that Europe faces as being actually fairly arguably straightforward to diagnose, versus in the Asia Pacific, where it is very, very different set of circumstances. And Australia and Japan, I guess, are two countries that can be maybe more forthright in how they articulate their concerns and their reactions to this.

But from your perspective, now, the balance of power is clearly changing, even if there is a desire to retain a balance of power. As you said, China's military is modernising, it is expanding. How does Singapore avoid feeling like a spectator as these changes take place? What are the sort of practical steps that can be made in terms of security, from a regional and from a national perspective?

SM Lee: Well, what I discussed and described are some of the things we are doing – we are actively instigating cooperation on trade. We are very active at the UN (United Nations) we have a Forum of Small States which Singapore initiated, and we continue to sort of help the group to convene and to discuss things with one another, which is very active. We are active in other forums as well, such as the climate change, UNFCCC (United Nations Framework Convention on Climate Change), where we contribute to the discussions. And actually, we chair one of the groups which discusses the structure of carbon markets, which is one of the more contentious and significant issues.

So, I think by active diplomacy, you can participate. You can help to shape the consensus. You can nudge things a bit this way or the other. If our critical interests are at stake − you cannot determine the outcome, because you have got to get everybody to come along − but we can pipe up. And if we make sense and make sense for more than just ourselves, then I think we can have some influence. It has been so.

Good diplomats make a big difference. You can be on Zoom, you can be on Twitter (or X now). But you want good people to be present, exercise, making an appreciation, understanding what the issues are, making an impact, impressing people with your competence, your commitment and your reliability. And therefore, they can do business with you. And therefore, well, you count for something. And I do not − I never say we punch above our weight. Once you think that, you are already going to be knocked out. We are just trying to do our best and to avoid being trampled on, or ignored.

Moderator: One more question for me before we go to the audience, I have already referenced Singapore's size. Now at the risk of being impolite with our guest, I am going to reference age as well now. Now age wise, Singapore turned 60.

SM Lee: That is very young for a country.

Moderator: Very, very young for a country. But nonetheless, it is sufficient time to have experienced serious global transitions and periods of serious uncertainty in the past. And of course, when Singapore became independent from Malaysia, 1965. This is the time of the late Lee Kuan Yew, your esteemed father. And those periods of instability are obviously incomparable in terms of the geopolitical forces at play, then versus now.

But I just wanted to ask you, with the sort of the wisdom of Singapore now clocking up a few more years on the clock, what are the insights that you might be able to share around the mindset of navigating unpredictability and uncertainty in potentially quite difficult situations?

SM Lee: Well, first I think you have to get your population girded up and aligned. And you have to be upfront with them and tell them, “We are in for a difficult time. This is what we can do, let us hang together. And there are things we can do, let us do it.” In the early years, we used to talk about “rugged society” – meaning one which is where people are able to take knocks and bumps, and you fend for yourself, and you are self-reliant. And you also hang together to deal with problems and to be able to make progress together. And with that philosophy, we came through and we made very steady growth over more than a generation.

And Singapore came from Third World to First during a period when we went through two oil shocks. Later on, an Asian Financial crisis, and then we had a global financial crisis. And there was a war raging in Southeast Asia in Vietnam, that came to an end. Then the Vietnamese invaded Cambodia, and caused considerable alarm, because we saw it as part of the Cold War and a proxy fight. But the region held, and we came through that too, and today we have ASEAN, and Cambodia and Vietnam are members of ASEAN.

So I think the first lesson is – level with your people, hold them together and then we maximise our chances by not being divided up amongst ourselves.

I think the second one is what I said earlier, externally, to be reliable, to make a constructive contribution, to be a player which people know will make a difference and can be helpful. Be relevant to others, be relevant economically so I can earn a living, and be relevant in other policy forums, so that well, your voice is heard.

Thirdly, you must be prepared to fend for yourself. If your fate depends on somebody else's blood and treasure, well then you may have best friends, but push comes to shove, who is going to be there fighting for you? You have to be prepared to stand up for yourself, which means investing in security, in defence, building up armed forces. In our case, building up National Service and armed forces, which means the draft,  and holding successive generations of young men and their parents to this mission and to this conviction that it is worth defending − I am prepared to go, and I am prepared to have my sons go and serve in the armed forces, spend two years of their lives full time, and then in the reserves for many more years after that. And they are defending the country, and it is something we are proud of doing.

And we have been able to sustain that for a long time. I think we will need it all the more. It is valuable to have friends, partners, people who can supply you weapons, people who can help you. In our case, with training grounds, because as you say, we are so tiny. If the taxi can arrive in 45 minutes, airplanes flying across take even less time – so where do my fighter jets train? And we need some place, and we do have them. But what you need is that will to defend yourself and to find the way forward.

Moderator: Fantastic to hear your insights. Now we have got questions coming in online, which I will come to in a moment. But I am going to take some questions from the audience to begin with. We have got a few microphones coming back. I think I will start with right at the very back, gentleman with his hand raised, standing at the back there.

David Lubin: David Lubin, I am an economist here at Chatham House, thank you very much for your visit. I wanted to ask you what role you think Singapore should or could play in supporting China's efforts to internationalise the use of the renminbi?

SM Lee: Well, we are a financial centre. We trade whatever instruments countries want to trade in, participants want to trade in. Renminbi is one of them, we are a renminbi settlement centre I think. And if people want to trade renminbi, we are happy to do that. How far it goes really depends on how far the Chinese are prepared to ease up on capital controls on the renminbi, and to deepen their bond markets and their financial markets, and to build up an ecosystem where the international investors − whether you are a sovereign fund or whether you are an MNC or an individual High Net Worth − will feel quite comfortable to take, say one-third of your net assets under management and say, “I put it in a Beijing bank or in renminbi bonds”.

That depends not only on the economic policies and the financial rules, but also on your overall political system and on the political relationships between China and the other countries, and on how China handles these financial obligations. Because the banker may turn out to not just be the banker, but he may take instructions from the government, and the government may have other ideas.

I mean, if you are carrying a US dollar asset and therefore, somewhere or other, you are linked to a US financial institution, or a financial institution which operates in the US, you know that there is, de facto, considerable extra territorial influence − if I may put it delicately − by the United States, if they wish to, on the fate of your investment. And people have to weigh that. Right now you say “TINA” – there is no alternative, so people still use the US dollar.

The Euro is one alternative but then you are considering carefully what to do with Russian deposits that are frozen, precisely for this reason. And the Chinese, if they decide to go on this path, they will have to decide to what extent they are prepared to allow this to be sacrosanct from other geostrategic considerations. I think they have not quite reached that point yet.

Moderator: Second question from the gentleman, he has got his hands up right there in the middle of that row.

Sanjay Guraj: Thank you Senior Minister for taking your time to get through this great topic. My name is Sanjay Guraj, and I am doing my master's in international relations at King's. So my question is given Singapore's diplomatic experience, how should Singapore strengthen ASEAN members to act as a regional bloc similar to the EU and which sector should it strengthen the partnership with? Thank you.

SM Lee: I think Singapore is the second smallest member of ASEAN. So, we work with our partners and where there is common interest, we align and we work together. On trade issues at the WTO, we often were able to do that because we did not have seriously contradictory perspectives. On strategic issues, it is not so easy to do because strategic situations differ, and therefore the security and strategic outlooks are very different. And therefore you fundamentally have not quite aligned views. If you talk about freedom of navigation, for example in the South China Sea, everybody says, “Yes, I agree, freedom of navigation.” Some countries have maritime fleets, some countries do not, some countries are landlocked. Laos is a member of ASEAN, is landlocked – it shares the border with China. Will it take the same interest and same perspective as Philippines, which is an archipelagic state and has a claim in the South China Sea overlapping with China? I think that is very difficult to bring about, however skilful your diplomats may be.

And if you are Indonesia, which is the biggest country in Southeast Asia and with a significant domestic market, your perspective will be different from Singapore – small, prosperous no doubt, but very dependent on the external world. We are very conscious that we are a price taker. So these are differences which we have to accept.

And so ASEAN, unlike the EU, does not have a supranational set of institutions and a place like Brussels where allegedly anonymous bureaucrats make decisions which are not always popular, and I think that is by design. Even the EU, with all its institutions, does not find it very easy to make qualified majority decisions, so much less ASEAN. I think we proceed at the pace we are capable of and that pace will vary depending on what subject we are discussing.

Moderator: I am going to take a question from the very front row here. If we can get a microphone to our Singaporean Chatham House colleague, Aroni, please go ahead.

Aroni: Good evening SM Lee, it is a privilege to welcome you here.

Moderator: Tell us, who are you?

Aroni: I am Aroni, I am with international affairs here at Chatham House, and a fellow Singaporean that is very happy to see you here.

SM Lee: Happy to see you.

Aroni: Your time as leader of Singapore has been almost my entire life.

SM Lee: I have not been PM for quite that long.

Aroni: So my story and understanding of Singapore is inextricably linked to you and your family and what vision you had for Singapore and its role in the world. Considering now that we are moving into new generations of leadership and also a new fragmented world order, based on your experience, what are some of the key foreign policy achievements that have had the most lasting impact on Singapore's global standing? And what lessons do you think Singaporean leaders can take from those moving forward?

SM Lee: I can only say that we are in reasonably good standing in the world. Joining ASEAN and encouraging the formation of ASEAN was certainly one of the formative decisions of our first Foreign Minister, Mr Rajaratnam. Because without ASEAN, you may be successful, but you are a little participant. But as a member of ASEAN well, you speak with a collective voice, and that is very valuable.

Beyond that, I explained some of the principles earlier which I think help us to do well. We have been consistent in maintaining a foreign policy which is principled, calculated based on our national interest and clearly determined by us, and not on behalf of somebody else. And this is absolutely fundamental. Because then they may like you, they may not like you, and you sometimes have a run-in with one power or the other. But you are speaking as Singapore and you are not speaking on behalf of − we are not the cat's paw for somebody else. I think that has always been fundamental and that remains a critical requirement.

It is very difficult for us to do that because we are multi racial – majority Chinese − 75% Chinese, 15% Malay, 9% Indian or South Asian. So, each one of our populations has a bigger, same-race population outside. China – 1,300 to 1,400 million. India – even more, 1,400 something million. And the Malay stock in the region, in Malaysia and Indonesia. And with that composition, to be able to say, “I am speaking as a Singaporean, not as a Chinese or an Indian or Malay”, I think it is absolutely crucial and yet very difficult. It causes a lot of confusion. I once explained this to a Japanese Prime Minister. I said, “We have Singaporeans − Chinese, Indians, Malays. And Singaporean Chinese are different from Chinese-Chinese, and we are different from Indian-Indians and Malay-Malays.” And he turned to his interpreter and says, “What is this Chinese-Chinese?”

Well, we are different. We are different because our national interests are different, and also because amongst ourselves, we have made accommodations and adjustments and compromises, and we know how to get along with one another. And if we walk along the street in London or New York, and you spot a Chinese, you look at him carefully, and you can guess that that chap probably came from Singapore. Maybe the way you walk, the way you dress, the way you interact with your family or with other people, there is a certain identity which is emerging. And that is very important. If you lose that because there is some influence operation, or you have some bot network which has persuaded you that you should be standing on one side or the other, well, then you are gravely compromised.

The other thing which makes our diplomats’ job easier, and is very important, is that:  domestically you are successful and you are united. If you are domestically not successful, you can have the most eloquent diplomats, but you are representing a country which is not working. Why should I listen to you? What can you do for me? But if domestically your system is working; you have got solutions to your own problems mostly; you are working on things and trying to make it better; and furthermore, there is consensus on where the country stands in the world, then it is much easier for our diplomats to make a consistent pitch and to say − and to convey without having to say it − that if you deal with us in five or 10 years’ time, it may be my successor, but he will be of cognate mind; it will not be the opposite of what I am doing. There is consistency; there is rationality; there is long term direction. We adapt as we go along, but we do not chop and change.

And it is not easy for many countries to do that. It is a very precious thing. I do not say that we can do that forever. But so far, we have been able to sustain it and my successor, I think, is carrying it forward quite well.

Moderator: So I think we had a question from the gentleman just on the end here, please.

Robin Nibblett: Mr Lee, Robin Nibblett, former Director of Chatham House. You talked at the beginning in your third solution to this difficult world we are in, that there should be greater intraregional cooperation. Looking at the ASEAN summit that just took place, there is one big example of intraregional cooperation, which is the Regional Comprehensive Economic Partnership (RCEP), which obviously China, I think, inspired at least. Well, okay, one in which China is a member.

But as you said earlier, how do we accommodate a China that has acknowledged large overcapacity, but where it may be leading the intraregional aspect of cooperation. How do you deal with that dilemma?

SM Lee: Well, the RCEP is quite a diverse group. I am not sure. I suppose, now that it exists, multiple people may claim parentage. But I thought Singapore had something to do with it, initially anyway. Because originally it was meant to be an East Asia Summit kind of partnership – basically the economies which are on the Asian side of the Pacific, and that included China and the Northeast Asian countries, Australasia, the Southeast Asian countries, and also India. And in that configuration, we thought you brought the major economies in, and there was a good balance – China, India – although India really is one quarter the size of China's GDP. And then you have Australia and New Zealand, who are treaty allies of the US. And if they are in the group, the group cannot be that anti-US. So we thought we had a good configuration, and it came quite far.

But you never know until you reach the marriage altar, who is there. And quite late in the process, the Indians decided that they did not want to participate in this. And therefore we now have well, ASEAN plus Northeast Asia plus Australasia. I think it is a useful grouping to have. I hope one day the Indians will be ready to participate. Certainly, if they are going to grow on projections, one day they will catch up with the Chinese, maybe even overtake them, because they have a much younger population, and the Chinese population is already declining.

But I think within that framework, there is room for significant economic cooperation. It is less substantial than the CPTPP, which covers many more areas and more deeply, but it does bring these countries together, and it is a signal that we want to trade with one another, and we do not want to “beggar thy neighbour” with one another.

So that is, I think, one package.

Your broader question, how does China fit into the system? I think the answer is, somehow or other, China does want to fit into the system, because from their perspective, they are not wanting to go and wreck the WTO system. They have benefited from this. They joined the WTO. It was at a time when Zhu Rongji was the premier, and he had a clear view that this was the way to force his own companies, including SOEs, to become internationally competitive. Because you have to follow the WTO rules, and therefore you have to open up your markets. I mean, some negotiated arrangement. But business has to be done, and therefore you have to measure up. And in the early years anyway, there were disputes which were brought to the WTO and they sometimes went in favour of the Chinese, sometimes went against. And when they went against, quite often the Chinese actually complied and fulfilled the judgements. I am not sure that is the situation now, but it was how it started up.

But now, what they say, and have said quite consistently, is that they uphold the multilateral trading system, and that they want to go by a rules-based order. But the rules-based order in which one participant is a lot bigger than the others, calls for forbearance and restraint and a certain self-enlightened magnanimity, which does not come naturally to any great power. And even powers which have done it for a long time, sometimes relapse. There are a few examples may come to mind. So in that situation, for China to participate is not so easy, because you have not only got to express the right attitude, you actually got to convince people that this is how you are going to behave in real life. And there have been situations where you have had disputes with countries. I talked about Australia – oysters and wine get caught up in the dispute. With Philippines, bananas, and things like that, run into phytosanitary problems. Each one of them has some technical explanation, but taken together, the question is, “Are we absolutely sure that trade is trade and politics is politics?”

And that is something which I think does need to be addressed, as does the question of the imbalance and how to restructure the Chinese economy so that it is less dependent on exports and can at least have a smaller export surplus and a greater degree of domestic consumption. It is not a straightforward matter to do – it is not just a matter of issuing coupons to buy new cars or refrigerators or of paying everybody more money. You have got to have quite a fundamental restructuring of the economy to make this happen, and it is very difficult.

And yet you do want to bring the Chinese into this ink blot of a rules-based trading system. Because if you keep them out, then you have taken the two biggest pieces off, and you are playing chess without the king and the queen, which are still roaming around the board on their own. That is very difficult.

Moderator: I am going to take a couple of questions in one go. Let us take a question from the gentleman here in the green jumper just down the middle, please, if you can bring the microphone.

Michael Mo: Thank you. My name is Michael Mo, PhD candidate at Newcastle University. We have a campus in Singapore, actually. So my question to Minister Lee is your insight on immigration /population policy – to do it right as a very small country − specifically how to mitigate security risks associated with immigration. For instance, espionage, disinformation and the consensus of Singapore. And at the same time not to do it quite in a discriminatory manner. I think this will be quite beneficial to UK politicians.

Moderator: Okay, great. So we got one question there, and I can take a question from the gentleman in the second row from the front, in the brown blazer, please.

Ravi Prasad: Thank you. Ravi Prasad, I work in the financial services sector here, but up until recently, was with the UK Foreign Office, including a very enjoyable four-year stint in Singapore. Singapore of course, stands out for how you have managed to maintain such positive, strong relationships with a whole range of powers – large and small, over the decades. I guess my question Senior Minister, would be around those rare instances where Singapore has come under pressure from some of those bigger powers. I am thinking, for example, US tariffs, or US talking points around currency, or whether that be around some of China's responses towards Singapore's economic relationship with Taiwan. I recall when you were DPM, there was quite a strong reaction to one of your visits to Taiwan. How have you personally dealt with those situations when Singapore has come under a little bit of pressure from those big powers and ensured those situations did not balloon more than they needed to be. Thank you.

Moderator: Thank you. So we got pressures from outside, pressures from inside. Take them in whichever order you like.

SM Lee: The immigration problem − it cannot be solved. These are trade-offs. You need immigrants. You need migrant workers. You need professionals to come. And you need them in quite large numbers. Some countries need them in huge numbers. In the UAE, they are 90% of the population. We are not quite at that point. Two thirds of our workforce, roughly, are Singaporean. But a very important part, one-third of that, which is more than a million numbers, are foreigners. All the way from CEOs of banks and MNCs, to skilled professionals of all kinds, to construction workers and unskilled, or not-so-skilled, but desperately-needed people to man our whole system. And you have got to manage not just the security risk, because some of them may bring in their foreign disputes and issues, and we have had some of those. You also have to manage the social issues which arise, because the numbers are very substantial. I mean it is one-third of our population – in the case of Britain, you have 70 million. That means maybe 30 million foreigners being here. But we need them, and we have got to accommodate them, and we have got to get them to understand what our rules are. At the same time as the Singaporeans, we hope will forbear and be gracious and know that they are here and helping us. And they too, have family and children back home, and we have responsibility for them while they are here.

It is not an easy balance to strike. It is one which is very easy to politicise and to work up. And there have been politicians who, throughout the last few terms of government, have been making this a hot issue, and sometimes it has been a hot issue during an election campaign. But if you send everybody home, well there are some examples of countries which have done that, and they have not had happy outcomes. I can talk about Huguenots and Louis XIV. That is long ago enough, but there are some more recent examples too.

And so we have to manage them, and they have to know that if you are in Singapore, please keep the bling down. Do not go around popping champagne which is $20,000 a bottle with sparklers, and do not zoom your Ferrari or Lotus or whatever down the middle of the road in the middle of the night just to let everybody know that you have arrived. You would not have thought that that was something you needed to tell anybody, but sometimes it is helpful to remind them.

But on the question of being non-discriminatory, I think that is kind of difficult to define exactly what you mean, because realistically, you must know what the social impact is and the social impact depends on where they come from. And some countries will create more social impact. People from some countries will create more social impact than others. They integrate more easily or less easily. So we cannot be completely omnidirectional and direction-blind in taking either immigrants or transient workers. But we try to manage the overall package so that overall, I have got not just an economy which has the people it needs, but we have got a society which can maintain identity and cohesion. You are coming to Singapore; you are not yet Singaporean; maybe you do not intend to be; you are going to finish working, go home. I understand that, but this is Singapore. Please comply with our rules and there are some basic norms. And it is not so hard if you want to be in Singapore – you can do that, but we will look after you.

So during COVID-19, we had tens of thousands of foreign workers who were in the dormitories, and they were at great risk; because in communal living with a highly infectious disease, it can go through and who knows what the consequences are. And we told them, “Don't worry, we will keep you safe. You will be fed, you will be housed, you will be sheltered, you will be paid, you will have internet connection so that you can keep in touch with your families, which is very important, and you will be safe.” And fortunately for us, many of them did catch COVID-19, but very few of them died. And it was a great load off our shoulders – mine particularly, I was the PM − that we got through that without a human tragedy. So I think you have to do these things. And people know that if they come to Singapore, that is the way Singapore works – the rules are strict, but this is not an inhumane system. 

Now, what do I do about pressure from powers on Singapore? Once in a while, it does happen. We treat it with – there is a sign which says, ‘Keep calm and carry on’. That is what we try to do. It happens from time to time. You do not want to escalate matters unnecessarily and just add fuel to the fire, but neither can you compromise if there is fundamental interest at stake. If it is a matter of face and some face saving is necessary, well, maybe we can do something.

And I do not know if you will remember Michael Fay. This is from a previous generation, but he was an American teenager. He is not a teenager anymore, but he was a teenager. He was in Singapore, he went around vandalising people's cars. And in Singapore, our rule, our law was – if you are convicted of vandalism, you get caned. And so he was charged in court and he was sentenced to some jail term and six strokes of the cane. And it became a cause célèbre. Bill Clinton was the President. I was not yet Prime Minister, my predecessor was. And Bill Clinton personally got involved – wrote to our Prime Minister I think, to our President too, to ask for clemency and compassion for this poor young man who had completely unintentionally done something not very good. So what do you do if the US President asks you for a small favour and you want to remain friends to the United States of America? So after some very serious consideration, we commuted the sentence from six strokes of the cane to four strokes of the cane. And a lot of Americans jeered us, but we remain friends with the US, and also with Bill Clinton.

From time to time, other issues have happened and well, you cannot help it. You must decide where your red line is. And if you do not want to be steam-rolled, well, you just have to quietly stand your ground – “I am sorry we do not agree. You have your view. We have ours. But I hope, notwithstanding that, we will be able to continue to work together”. So far, that has been a formula which has worked for us. I cannot say that it will always work. At some point the pressure may become overwhelming, but that is why we are all in favour of the United Nations and a rules-based global order.

Moderator: I will come back to the room in a moment. We will have time for a few more questions in the room. I am going to go online. Very interesting pair of questions from Ayodhya G Alaka asking about Africa and Singapore. The first part of the question is, Singapore navigating and developing its trade investment relationships with Africa's 54 states. But the most interesting point is this phrase that sometimes comes up − of creating a new Singapore when you are looking at another country − comes up in different parts of the world. But with regards to the challenges around infrastructure and jobs and governance in parts of Africa, what, in your opinion, is the one thing from Singapore's experience that you believe could truly make a difference if applied to parts of Africa.

SM Lee: Well, we have a lot of friends in Africa. I think we are very chuffed that many of them see us as a model and would like to pick up something from what Singapore has done. I would hesitate to recommend policy solutions for other countries, which I really do not understand well enough, and which vary enormously from one to another – If you are South Africa, there is one situation. If you are Ethiopia, there is a completely different one. If you are Rwanda, well, maybe that is a bit more comparable, but that has its own very tragic and complicated history. But what does matter, what I think has been very important to us, and without which we could not have succeeded, is a group of people who feel a certain sense of mission to take the country forward – maybe in the government, maybe in politics, maybe in the private sector. But you do feel a collective responsibility that this is not just a society which is going to take care of itself – someone has to step forward, take charge, take responsibility and do your best as a steward to say, “I am carrying it the next step forward. And I hope by that time, there will be somebody else who will take it from me and carry the baton on”. And I think that is something which is necessary in any country. And if you can have that, then you can have efficient government, you can have honest government, and you can have government which is trusted, and good things can happen.

Moderator: We have time for just a couple more questions, so we will take a question from the gentleman right here, second row from the front.

Moez Hayat: Thank you Mr Senior Minister. My name is Moez Hayat. I am a PhD candidate at Cambridge University in Politics. I had a quick question on ASEAN. You mentioned how important ASEAN is, especially at this time. Do you think part of that would require strengthening ASEAN institutions, and specifically growing the funding and the capacity of the ASEAN Secretariat to have maybe a stronger organisation that can respond to some of these challenges? Thank you.

Moderator: The gentleman has been waiting very patiently with a red tie, just there.

Q: Thank you. Hi, Senior Minister. I am from Cambodia myself, and I realise that Trump plays an important role in ASEAN’s future, and I guess relationship with the US. And my question is given ASEAN’s export-driven economic model, how do you think ASEAN as a whole could leverage the relationship with the US right now, as Trump has been particularly interested in, I guess, as ASEAN as a bloc. Thank you.

Moderator: Very neatly paired questions have we?

SM Lee: I think it is always helpful to strengthen institutions. The question always is: how much will it cost, and who will pay for it? ASEAN has got a Secretariat. The Secretariat does a lot of projects. We have a lot of meetings and very wide range of cooperation. Now it has not become as intense as the EU, but very regular and a very valuable habit. So we deal with each other repeatedly, and therefore you know that you want to maintain that relationship, and you do not go to war on one issue because there are a dozen others which matter and which we need to still work together on.

I do not think that the constraint on ASEAN right now is the strength of the institutions.

I think the question is, first, the degree to which the countries have a consensus on issues. Do they agree on the basic issues or not? And secondly, if you are going to have stronger institutions, to what extent you are going to give them powers to override what governments want to do?

And that is a very hot subject, even when you were in the EU, and still is in the EU. So I think that the priority is not so much on building up further the institutions. You want them to work well. But really the priority is continuing the habit of cooperation and expanding the areas where we see eye to eye so that we can do more together.

How does ASEAN take advantage of its good relations with Trump in order to export more to the United States? I think right now, every country wants to take advantage of its good relations with the US President in order to maintain a stable relationship with the United States. And for ASEAN, that is probably a realistic objective. The ASEAN countries are not all on the same level with the United States. Some of us have a trade deficit with the US, like Singapore. Other countries have a trade surplus with the US, for example, Indonesia or Vietnam. Some of us are trading goods which are mainly made by US MNCs in Singapore – for example, pharmaceuticals or electronics. Others are selling the US raw materials, minerals or even rare earths. So the situations are different, and I think each country will work its own arrangement with the US.

It has not been so easy for the EU to negotiate as one too, for a trade agreement with the US. You have to decide whether you are going to take the hit on parmesan cheese or Mercedes cars or cognac. And that is one of the reasons − not the only reason − but one of the reasons why the EU is not taking as aggressive a line on trade as the Chinese have been with the US. So similarly with ASEAN. But I think if we can just maintain an equable relationship and accept that sometimes these things happen. And you may or may not be able to justify it in terms of abstract principles − either principle of economics or principle of ethics and just rewards. But that is just the way the world is.

Moderator: Senior Minister, we have come to the end of our time with you, but I want to just say how enlightening it has been to hear on the one hand your pragmatism, on the other hand, your optimism – I think, in terms of navigating this particularly difficult era in global affairs and that unique Singaporean perspective and your perspective that you have articulated. Thank you so much for spending this last hour and 15 minutes or so with us. And I think let us all join and give the Senior Minister our thanks and appreciation for his time here, thank you so much.

SM Lee: Thank you. Thank you very much.

[1] The JSI on E-Commerce is a plurilateral initiative at the World Trade Organization (WTO) that covers three broad areas of (a) digital trade facilitation; (b) open digital environment; and (c) business and consumer trust.

In July 2024, Singapore, Australia and Japan, as the co-convenors of the JSI, announced that participants had achieved a stabilised text, marking a significant milestone after five years of negotiations.