Through the trade route and other initiatives, China has the potential to build a “new economic architecture that can uplift economic growth in this hemisphere”, Singapore's Home Affairs and Law Minister says.
The China-Pakistan Friendship Highway is a crown jewel of China's One Belt, One Road (OBOR) initiative, a massive global infrastructure programme to revive the ancient Silk Road and connect Chinese companies to new markets around the world. AFP/Johannes EISELE
28 Aug 2017 11:56AM (Updated: 28 Aug 2017 12:34PM)
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SINGAPORE: China's Belt and Road initiative (BRI) presents many opportunities for growth in the region, but the Asian superpower has to work with other countries for it to succeed, Singapore's Home Affairs and Law Minister K Shanmugam said on Monday (Aug 28).
Building on the ancient overland Silk Road economic belt connecting China to Europe and the Maritime Silk Road connecting Asia, the Middle East and Africa, the BRI is aimed at facilitating trade and investment flows between China and other countries through infrastructure.
Speaking at the Asia Economic Forum at the National University of Singapore, Mr Shanmugam said the project was bold, imaginative and ambitious, and exemplifies the vision of a country that is currently the "world leader in many aspects of infrastructure technology".
China has also been “very strategic” in the way it has been investing, linking up with other countries and building relationships, and its companies are prepared to take risks and invest in large infrastructure projects, the minister said.
Noting the many criticisms levelled at China and its political system, Mr Shanmugam said that it must be acknowledged that the country has achieved results for its people over the last 35 years “on a scale that no other country in history has” – both in terms of the speed of progress and the number of people who have made the leap from poverty to prosperity.
“China has been showing its detractors are getting it wrong,” he said, citing its success in the field of science and technology, contrary to claims that its political system does not allow innovation.
Mr Shanmugam called the BRI "arguably the most ambitious infrastructure project in history" with the "potential to bring Eurasia, China and Southeast Asia even closer together".
However, he added a note of caution: While routes such as the BRI enable trade, they can also enhance connectivity between extremists and jihadist influences. There are also risks associated with other countries' individual interests, he said.
"China will have to try and work with these different interests, and try to align them. That is not going to be easy. In many ways, building the infrastructure is the easier part."
If there is a deficit in trust with other countries, regional counter blocs with countries such as India, Japan and perhaps powers outside Asia may form, and possible US influence "should not be underestimated", the minister said.
Such blocs are not optimal "for China or for anyone else", he added. "No country, not even China, can really go it alone in the modern world ... It's in China's interest - and ours too - that its rise to great power status, or even superpower status, is peaceful and is seen to be peaceful."
Mr Shanmugam said that China has the opportunity through the BRI and other regional initiatives like the Regional Comprehensive Economic Partnership to build a "new economic architecture that can uplift economic growth in this hemisphere".
It will be easier to achieve this if it is able to work harmoniously with "countries which have weight, influence in the world economy" as well as receives the cooperation of such countries along the Silk Route, he added.
CHANGING BALANCE BETWEEN CHINA AND THE US
In his speech, Mr Shanmugam noted the rise of China, which he said is likely to be the largest world economy in absolute terms, though not in per capita terms. Technologically and militarily, China will become a more significant player over the next 20 to 30 years, he predicted.
With this, he said there will also inevitably be a change of relative power between America and China.
Although the minister stressed that the US still has a significant lead, the world superpower will have "less and less scope for unilateral actions especially in areas of the globe where China has strong interests", he said.
China also will not be able to ignore US interests even as its power increases, he added.
"It is likely that the US ability to decide unilaterally will be reduced from what it has been in the last 25 years. At the same time, it is difficult to see any one country - including China - taking over the US' role of global leadership."
Mr Shanmugam also argued that it is in China's interests to work with the existing international order built on free trade.
He said that for many Asian countries, while China is the biggest trading partner, the ultimate consumer of most of the traded products is still the US. The products go as intermediate products to China, before the finished products are then exported to the US.
This situation will likely remain for some time to come, he said, adding that for the BRI to succeed, the globalized economy needs to function. This means "there must be no trade wars between China and the US; there must be continued growth, peace and stability - all of this and more will be necessary.”
The minister said: "How stable a more multipolar world will be difficult to predict, but it will be in the US', China's and other countries' interests to maintain stability."
HOW DOES THIS IMPACT SINGAPORE?
According to the Home Affairs Minister, figures show Singapore is already benefiting from the opportunities offered by the BRI, with China's investments in Singapore alone making up about a third of its total investments in BRI countries.
Singapore's investments in China also accounted for 85 per cent of total inbound investments from BRI countries, he noted.
The country recognised very early the potential for China's growth from the early 1980s, and was an “active proponent of that growth”, Mr Shanmugam said, adding that the country supported the BRI since its early years of inception.
"With the new opportunities, we can (and) should be able to find ways of being economically relevant."
Small states must continually earn their relevance on the international stage, he said. "China, the US, India will be there a hundred years from now. For us, nothing is guaranteed. The world can pass us by in an instant."
Singapore benefits from initiatives like the BRI and will also continue to maintain good relationships with its neighbours, with China as well as its Western counterparts in Europe and the US, he said.
"Can Singapore remain relevant in the future? We can, if we are smart ... we achieved what we have achieved by thinking bold, thinking big."
Read more at http://www.channelnewsasia.com/news/singapore/for-belt-and-road-to-succeed-china-must-work-harmoniously-with-9162874