Lee Hsien Loong (Singapore Prime Minister) – International Conference on the Future of Asia (May 2022)

Chapters

Abstract

Asia’s Future at a Crossroads: Navigating Challenges and Seizing Opportunities

Lead: The Balance of Power, Cooperation, and Prosperity in Asia

Asia is at a crucial point in its history, with immense potential and significant challenges shaping its path. Projections indicate Asia’s dominance in global GDP and consumption by 2040, signaling a rapidly evolving economic and geopolitical landscape. However, this transformation is accompanied by geopolitical tensions stemming from the Russia-Ukraine conflict, US-China rivalry, and the necessity for strategic cooperation, creating a complex matrix for Asian nations to navigate. The region’s trajectory hinges on a delicate balance between cooperation and competition, security and prosperity.

Asia’s Economic Potential and Geopolitical Challenges

Asia’s dynamic growth, driven by a large and young population, is reshaping the global economic order. China, India, Japan, and Southeast Asia are at the forefront of this shift, their collective growth fueling regional and global progress. However, geopolitical tensions cast shadows on this promising outlook. Russia’s invasion of Ukraine not only disrupts the global order but also holds profound economic consequences for Asia, exacerbating the region’s challenges.

Asia’s potential for growth is enormous due to its large and young population. China, the world’s second-largest economy and fastest-growing consumer market, is poised for continued expansion. India, with its demographic dividend and rapid growth, is a major contributor to regional progress. Japan, an advanced economy, plays a crucial role through investments, technology transfers, and imports. Southeast Asia, with a population of 650 million and a combined GDP of US$3 trillion, represents the fifth-largest economy globally.

Strategies for Success Amidst Rising Tensions

In response to these multifaceted challenges, Asian countries are encouraged to strengthen economic cooperation and integration. Pursuing free trade agreements, promoting regional connectivity, and investing in infrastructure, education, and innovation are vital steps towards progress. Additionally, addressing common challenges like climate change and pandemics through collective action is crucial for regional resilience.

Asian countries should learn from the European experience to avoid conflict. They should not become excessively reliant on any one country for energy or other resources. Defense postures need to be strengthened, and cooperation among Asian countries is essential.

Drawing lessons from Europe’s experience, particularly its over-reliance on Russian energy and the resultant push for diversification, Asian countries are cautioned against similar vulnerabilities. The increasing defense spending and NATO expansion in Europe serve as a reminder of the need for preparedness and strategic foresight in Asia.

Promoting Peace and Stability in the Face of Regional Security Concerns

While individual nations may bolster their defense capabilities, the emphasis on collective security and establishing trust-building measures is paramount. The handling of potential flashpoints like the Korean Peninsula and the South China Sea requires diplomatic finesse and a balanced approach to power dynamics.

Regional security challenges will lead countries to re-examine defense strategies and potentially strengthen capabilities, potentially leading to an arms race. Cooperation is crucial to strengthen collective security beyond alliances. Engagement and trust-building with potential adversaries, including quiet communication channels, are essential to reduce mistrust and manage acute incidents. Careful handling of flashpoints like the Korean Peninsula, Taiwan Strait, and South China Sea is critical to avoid miscalculations and escalation.

Many stakeholders, including countries from outside Asia, have legitimate interests in the region, including maintaining stability, open business, and accessing sea lanes. The US still plays an essential role in regional stability, but a balance of power and influence among all stakeholders, including the US, EU, and UK, is desirable.

Security and Economic Engagements: Security arrangements and economic engagements should work together to form an open and inclusive regional architecture. The US-China rivalry affects all Asian countries, and most prefer not to choose sides. ASEAN plays a significant role in regional architecture, and its centrality has led to forums and mechanisms for regional integration.

ASEAN Initiatives: ASEAN Plus platforms provide neutral venues for dialogue and engagement. The Regional Comprehensive Economic Partnership (RCEP) is a free trade agreement with an open and inclusive framework. China, Japan, South Korea, Australia, New Zealand, and ASEAN are all members of RCEP.

Economic Cooperation as a Pillar of Stability

Economic collaboration is a cornerstone for mitigating geopolitical tensions, offering pathways for dialogue and problem-solving. The shift towards resilience-focused strategies, however, must be balanced to avoid exacerbating divisions. Initiatives like the US-led Indo-Pacific Economic Framework and China’s Belt and Road Initiative illustrate the diverse approaches to fostering economic ties in the region.

Resilience and national security concerns should not lead to extreme measures like disconnecting from global supply chains or friendshoring. Economic cooperation complements security cooperation, providing incentives for countries to work together and overcome challenges. Major powers like the US and China should demonstrate their engagement in Asia through tangible win-win economic benefits. The US has extensive economic ties with Asia but withdrew from the TPP under the Trump Administration. The Biden Administration launched the IPEF, promoting collaboration on trade, supply chains, clean energy, and digital and green economies, but it lacks trade liberalization. China’s growing economic influence is natural and positive, benefiting the region. China’s integration into the regional economy is preferable to operating under different rules. China’s initiatives like the Belt and Road Initiative and the Global Development Initiative have been welcomed by many countries.

The US-China Rivalry and its Regional Implications

The US-China rivalry casts a long shadow over Asia, with countries often feeling the pressure to align with one of the superpowers. This dynamic underscores the need for an open and inclusive regional architecture, where countries can maintain amicable relations with both powers. ASEAN’s role in promoting integration and Japan’s potential in regional affairs, despite historical constraints, are critical to this equilibrium.

The US-China rivalry has grown in recent years, manifesting in Asia and potentially leading to technology bifurcation and supply chain disruptions. Unintended consequences of this rivalry are possible. Asian countries should focus on maintaining peace and stability in the region and work together to reduce the likelihood of conflict. Maximizing opportunities for collaboration and minimizing tensions is essential.

Lee Hsien Loong’s Vision for Asia

Singapore’s Prime Minister, Lee Hsien Loong, advocates for a balanced approach to navigate the US-China rivalry. He underscores the importance of constructive engagement, regional integration, and the maintenance of an inclusive architecture for peace and stability. Lee’s vision emphasizes the crucial role of ASEAN and the potential of Japan, highlighting the need to address historical issues for a robust regional cooperation framework.

Lee Hsien Loong’s vision for Asia is balanced, emphasizing constructive engagement, regional integration, and an inclusive architecture for peace and stability. He recognizes ASEAN’s critical role and Japan’s potential, highlighting the need to address historical issues for a strong regional cooperation framework.

Charting a Path Forward

In conclusion, Asia’s future is intricately tied to its ability to navigate the complex interplay of economic potential, geopolitical challenges, and the necessity for strategic collaboration. The region’s success hinges on its collective efforts to foster economic growth, maintain regional stability, and engage in constructive diplomacy. By learning from global experiences and leveraging the strengths of regional platforms like ASEAN and initiatives like RCEP, Asia can chart a path towards sustained prosperity and peace.

Japan’s Role: Japan is a leading investor in Asia and a strong advocate for regional trade liberalisation. In the security field, Japan should consider how to come to terms with its past and contribute more to regional security cooperation.

Maintaining Stability and Peace: Asia has enjoyed a stable and secure environment for decades, critical to its dynamism and prosperity. Asian countries must continue to deepen cooperation, foster mutual trust, and resolve differences to maintain positive momentum and realise a peaceful and vibrant Asia.

Notes by: Flaneur