A Conversation With Lee Hsien Loong

Wednesday, October 25, 2017
Michele Tantussi/Reuters
Lee Hsien Loong

Prime Minister, Republic of Singapore

Prime Minister Lee Hsien Loong discusses U.S.-Singapore bilateral relations as well as strategic challenges and opportunities in the Asia-Pacific. 

OSNOS: Good afternoon, everyone, and welcome to the Council on Foreign Relations for a very special session today. We’ve got a conversation with Prime Minister Lee Hsien Loong of Singapore.

I’m Evan Osnos from The New Yorker and the Brookings Institution, and it’s a great pleasure to welcome back to the Council a prime minister who has been here before and is taking time out of his schedule to talk to us not only about U.S.-Singapore bilateral relations, but also the broader challenges and opportunities in the region, of which there are many these days.

A word at the outset here, just a bit of introduction. I can’t give his biography the full treatment it deserves, because that would eat up into the time in which he’s actually going to tell us about his visit. But just a note to say that it’s fair to say that there’s no head of government in Asia today who has more experience from more vantage points than the prime minister in his engagement with the United States. And this goes back, of course, to his days in the military, when he was stationed for a while studying at the Army College at Fort Leavenworth, Kansas—a voluntary stint at Fort Leavenworth, I’ll point out. (Laughter.) He rose to the—

LEE: I did visit the penitentiary. (Laughter.)

OSNOS: Oh, good. Well, we’ll—a few people in our town have done that as well, as a matter—(laughter).

Well, he rose to the rank of brigadier general, then he spent 20 years in parliament. He’s been minister of finance, minister of trade and industry, deputy prime minister. And, of course, he’s been prime minister since 2004, which means that he’s now sitting across the table from his third American president. And please join me in welcoming the prime minister today to the Council. (Applause.)

LEE: Thank you.

OSNOS: And, if I may, I’ll invite you to start off with a few words just to frame our conversation. So the floor is yours.

LEE: Well, very glad to be back here in Washington again. I was here last August, last year. You’ve had a change of administration since then. I think this is a good moment to be here. It’s 10 months into the new administration, and a couple of weeks before your president goes on a long and important trip to Asia: Northeast Asia, China, Japan, Korea, and also to Southeast Asia—Vietnam and the Philippines.

Asia has continued to be a vibrant and very dynamic part of the world. The economies are generally doing quite well. The Chinese are prospering, the Japanese not as badly as before. Southeast Asia chugging along moderately, and gradually making progress in economic integration amongst Southeast Asian countries in ASEAN. India, with Mr. Modi, having a new sense of drive and direction, although with politics never absent.

At the same time, the countries are also getting more closely interlinked and interdependent within Asia. I talked about what ASEAN is doing.

India, which hitherto—which traditionally has been more inward-focused and focused on its subcontinent, now, with a growing economy, is looking for manufacturing investments. It has to look for markets overseas. It looks for partners in Japan, in America, in Europe.

And China, particularly, has been linking up with the region—linking up via trade. It’s one of our—it’s the biggest trading partner for nearly everybody else in Asia, including Singapore. It’s got a Belt and Road Initiative, which is a grand strategic plan to enable it to participate in the prosperity of the region and to prosper its neighbors while it grows its influence. And it’s a scheme which many of its neighbors would like to participate in. And it’s got an AIIB, Asia Infrastructure Investment Bank, which will be providing financing and urgently-needed infrastructure for lots of countries, developing and more developed.

So there are a lot of things going on in Asia. There are issues in Asia which are urgently needing to be dealt with, the North Korean issue for one. There are maritime and territorial disputes—the Senkakus or Diaoyu Islands, the South China Sea. There are—there is over above all, the overriding need to accommodate a changing strategic landscape, because the Chinese are influential, growing more so, and need to be accommodated in a stable and constructive way into the regional and global system.

And how that happens depends on what happens within the region and the dynamics within the region, but it also depends on what role America plays and how your role adjusts after 75 years, or now soon to be—or plus, since the war. You’ve held the peace. You’ve provided security. You have opened your markets. You have developed links across the Pacific. And now, with a rising set of players on the west coast of the Pacific, where does America want to go? Do you want to be engaged? Do you want to participate more? Do you want to deepen your economic relations? Or do you want to find some other balance which really will leave the determination of affairs to other participants in the region?

It’s the question which you have to decide. I think you cannot disengage yourself from the region. If you look at North Korea, it’s not going to be easily solved, but certainly it will never be solved if you are not there and part of the—part of the—actively a participant. And I think from the point of view of the region, we take comfort that your secretaries—Mattis, Tillerson, McMaster—have traveled in the region, have stated positions which have given us a lot of comfort and reassurance that you know what is up and you know what you need to do. And we look forward to receiving your president soon and hearing similar messages from him because, finally, he’s the commander in chief and he sets the tone.

And we—it’s not—everybody in the world, friend or foe, needs to know where America stands. And Singapore has stood as a friend of the U.S. for many years, and we hope to continue so for many more years to come.

OSNOS: You’ve met over the course of the last few days, of course, with the president. You’ve met members of the national security team. You’ve been on the Hill this morning. What have you gained from your interactions so far when it comes to the key message that you just drove home, which is about the importance of the United States in the region?

LEE: I think I take comfort from the fact that nobody is talking about disengaging. I think they are talking about engaging in a different way. They feel—there is a feeling in the administration that somehow America hasn’t got quite as long an end of the stick as it ought to, and they would like a rebalance. It may be in terms of blood and treasure. It may be in terms of market rules. It may be in terms of influence in the world. But the world has changed, and America would like to have an adjustment. And I can completely understand that.

But I am reassured, talking to quite a number of the officials—I haven’t met so many on the Hill; I’m going to be seeing some more—some people this afternoon—that they know that America’s fate depends on what happens in the rest of the world. I think they also know that America, because it has taken a very open and generous approach, has enabled a stability and prosperity in the world which others have benefited from, and so too the United States.

You have been the most open market in the world. The Europeans deny it, but I think it is true. The Japanese raise an eyebrow, but I think it’s also true. And now the Americans are saying, why should that be so? I mean, the others should be as open as us. I can tolerate the Japanese, I could accept the Europeans, but now the Chinese are a different order of magnitude, and they ought to be like us. And I think it’s reasonable to push for that, but if you want that to happen overnight it may well come to grief.

OSNOS: You were last here in August of 2016.

LEE: Last year.

OSNOS: Quite a bit’s changed since then. Do you sense that the changes are political, they’re cyclical in nature? Or do you sense a fundamental change in America’s approach to Asia?

LEE: Well, it is the result of an election process. Those were your rules. This is the outcome. And the fact that you now have this outcome has created a new fact. You are in a new position. The policies which this president will pursue and which his administration will try to implement will create expectations and new results. And some things will be done, some things will become undone, whether—I mean, it could be the Iranian arrangement. Certainly, the TPP is undone. And you have—we have moved on to a new situation, and you cannot go back to where you were. It may be you may have—I mean, in politics, no party stays in power forever, and at some point another party will come in, another mood will take over in the country, and you will have a president who will pursue a different approach. But this will be part of—will have become part of the discourse, part of the expectations, and I think it would be very, very difficult to go back to where you were on the 1st of November 2016.

OSNOS: Well, you’ve been an advocate for the TPP. You were disappointed that the United States backed out of the TPP.

LEE: Yes.

OSNOS: What happens now to countries like yours that were so in favor of it?

LEE: Well, we just accept that what we had put a lot of hopes on is not going to happen, and we will make the best of a new situation. This is where we are, and we try to make progress from here.

The other 11 members of the TPP negotiations are talking amongst ourselves to see what we can work out and develop on the basis of the work which has been done on the TPP without a complete new negotiation, which nobody has any stomach for. And we hope we’ll be able to work something out, but it is not easy, because had we started without the United States, we could have worked out a deal. It would probably have looked quite different from what we worked out with you. When you came in, that totally changed the picture because you brought with you, first, your markets; secondly, your considerable influence on what you wanted. And what you wanted isn’t just access to our markets, but also rules and intellectual property and human rights and so many other things. And, having worked out a document, the basis of which if that you are the anchor participant, and now that you’re out, which parts of this document do I keep? And if I undo some part of it, will I unravel the whole scheme? And that’s what our trade ministers are working very hard at.

OSNOS: How do you think – America’s withdrawal from the TPP and the general basket of ideas that we call “America first” here these days, how do you think that affects China’s role in the region?

LEE: I think the Chinese are watching this carefully. On the one hand, they’ll be concerned about their bilateral relationship with you—where does it go, what are you trying to do, how can I establish a stable relationship with the United States, “I” meaning China. Because they—(chuckles)—they are used to not only stable government, but taking a long perspective on issues. And you—in Washington, it is not possible to take such a(n) Olympian view because your politics changes too quickly.

OSNOS: That’s an understatement, and I’m with you 100 percent. But yeah. (Laughter.)

LEE: So that’s one aspect of it. But the other aspect of it is, while they’ve got certain objectives and they will pursue these assiduously, quietly farming away, and they will make friends and influence people whether or not you are there—and if you are not there, then everybody else in the world will look around and say: I want to be friends with both the U.S. and the Chinese, and the Chinese are ready, and I’ll start with them.

OSNOS: Your late father, Lee Kuan Yew, used to talk about the balance of power, that in a sense you have the United States as your greatest trading partner and—sorry, China as your greatest trading partner, but the United States as your greatest security partner.

LEE: Yes.

OSNOS: Is that balance of power becoming more difficult now?

LEE: Well, it depends how you work out your relationship with the Chinese. I mean, you need them to deal with a lot of issues. They have become more—stronger. They have become bigger. It means that you need their cooperation more, not just on bilateral issues but on strategic things. I mean, to do climate change you must have them. Otherwise, no deal is reachable. To do nuclear nonproliferation you must have them onboard. To deal with North Korea you must have them onboard. So if you are able to work with them, a stable, gradually-evolving relationship which gives them the space to grow their influence but in a benign way, then we are fine, we remain friends with both. If you become—if you have a tense relationship, and one or both of the parties say you are either with me or you’re against me, then we are in a difficult spot. It could happen.

OSNOS: The Belt and Road Initiative, which Xi Jinping of course has overseen, the Chinese talk about it as a new basis for stability and security in the region. How does it feel to you in the region?

LEE: Well, I think our view in—our view in Singapore, which is shared by many in the region, is it is a positive thing. The Chinese are going to grow their influence. It’s going to happen. How is it going to fit in? And this is one coherent framework within which the Asian countries—Central Asian, Southeast Asian, South Asian—can participate in this. And it means infrastructure. It means financing. It means connectivity. It also means influence. And if you ask any of the countries in the region, they will say yes, I want to participate—I want to trade, I want to do business, I’d like them to invest. There are political sensitivities, but subject to that there is a lot of business which is to be done.

At the same time, the region has prospered not by doing business only with China, but also by doing business with America, with Europe, and the rest of the world. And I don’t think any of the countries in the region would like to give that up. So, provided the Belt and Road happens in such a way that all these external links open—stay open and the region remains an open region, I think it’s a good thing.

OSNOS: Does Belt and Road pose a challenge for the United States? And should it do anything to try to make sure that it fortifies its—

LEE: Well, it’s not whether Belt and Road poses a challenge to the United States. The question is, how are you going to respond to a China which has got a GDP which is about—which will within the next decade or two at most be as big as yours; with world trade, which is considerable; which has financial resources, which is considerable? And you cannot say that I will deal with them on the basis that they will have an armed force the size of a middling European country and global influence the size of, oh, I think it would be invidious to name anybody, but you know what I mean. (Laughter.) It cannot be. They are going to be a power. They want to be a big power. The question is, how can that happen constructively and benignly? And I think Belt and Road is a constructive way to do it.

OSNOS: South China Sea, East China Sea, a subject of great interest to many in this room. It’s been a subject of, obviously, interest to you as well. How do you see it playing out at the moment? Do you see tensions continuing to grow, or is there something the United States can play in that process?

LEE: I think they are different. The East China Sea, the issue is between China and Japan. These are two countries which have not really come to terms with the history of the war. And neither of them wants the Senkakus/Diaoyu dispute to blow up, but neither of them is going to give way. And therefore, you could have a mishap, and then you could have an escalation. It’s already nearly happened more than once. The Japanese arrested a Chinese fishing boat. You have people exchanging—buzzing—aeroplanes buzzing one another. Sometimes they shower each other with water hoses. So you could easily have a mishap, and it could be very troublesome.

You could have a mishap in South China Sea, too. But it’s different in one very important way, which is that the other claimant states in Southeast Asia, none of them want to collide with China. All of them have got a major relationship with China over many fronts—on trade, on aid, on human resources, on direct financing of all kinds of projects. And South China Sea is one item. It’s politically sensitive. It’s nationalist. But it’s not the only thing in the relationship, and they do not want this to blow up the relationship, and they will not go to war on this. And therefore, it sets a limit to how far things can boil over. But at the same time, of course, that means that, well, a different balance of outcomes can be expected.

OSNOS: What role would you like to see the United States play in that question?

LEE: The United States is not a claimant state. You are a user of the South China Sea. Your ships sail through it—your merchant vessels, your Navy. Your aircraft sail over it. You have an interest in freedom of navigation. You have an interest in international law. Singapore has those interests, too: freedom of navigation, international law, stability and security in the region. And I think that those are considerations which any president and any national security adviser or State or Defense Department will have to take into account.

OSNOS: You’re going to be—Singapore will be chairman of ASEAN beginning next year.

LEE: Next year, yes.

OSNOS: When we look at Southeast Asia today, one of the questions we’re trying to figure out is whether there are two camps that are forming, in effect: one camp, whether it’s the Philippines and Malaysia, that is creating greater—a stronger relationship with China; and then another camp. Is that the wrong way to look at it? Or how do you—how do you see—

LEE: I think ASEAN works on the basis of consensus. It is not the 50 states of the United States of America. Neither is it the 20-odd states of the EU. These are 10 sovereign countries which have come together in an association. Where there is an—where there is an alignment of interests and a consensus of views, then there is an ASEAN position. Where there is not, then we agree to disagree and we will discuss the matter again one day.

On strategic issues, there is no single strategic perspective. There are threat assessments. There are fundamental interests. The geopolitical positions of the countries are very different.

Indonesia and the Philippines are archipelagic states.

Laos is a landlocked county that has no border with the South China Sea. It has a land border with China.

Vietnam has a border with China. They have a relationship which goes back 2,000 years, and invasions and wars, and coexistence.

Myanmar has a coastline on the Andaman Sea, not the South China Sea, and their two biggest neighbors are China and India. And they very much hope that they have other friends, and anybody else who is friends with them is their third friend, including the United States. They want to be. So when you say you want to put them in the doghouse, well, then you reduce them back to their geographic neighbors, and that has certain consequences.

Singapore, we are in the middle of all this. We are one of the smallest, other than Brunei. We are the only country in the region—in fact, in the world—with a Chinese ethnic majority. And yet, not a Chinese country, but a multiracial country.

So our perspectives are all severally different. And on some issues the lowest common denominator is basic, but still worth having.

OSNOS: Do you see a role—you mentioned Myanmar a moment ago. Do you see a role for ASEAN in terms of addressing the humanitarian crisis there?

LEE: Yes, yes. ASEAN discussed this. It’s not easy to do because, as I said, these are sovereign countries and we can’t just march in. We have no mandate, neither the capability. But there is a humanitarian crisis, and ASEAN issued a statement. And we have given humanitarian assistance, and we will continue to do so.

OSNOS: This week is a big week in Beijing, and I think a lot of people here would be curious for your assessment of what it means to have the 19th Party Congress introduce the next generation of leadership. Now, well, let’s put it differently. Let’s say that it’s enshrined Xi Jinping in office and has opened the next chapter of his leadership. How do you think this is going to play out?

LEE: I don’t think he was enshrined in office, only his words.

OSNOS: Well, all right, fair enough. I’ll own those. (Laughter.) How do you see it playing—what’s important about what happened in Beijing this week?

LEE: Well, he has consolidated—Xi Jinping has consolidated his position. He has got a new lineup in the core leadership of the Politburo Standing Committee, also in the Central Military Commission. He’s got his Xi Jinping thought inscribed in the constitution. His own leadership position is preeminent.

At the same time, I think there is a purpose to this, which is to signal that this is the start of a new phase for China. And they said—they said xīn shídài, a “new era,” and that means Mao’s era, Deng’s era, and now Xi’s era. And it’s an era which he envisages extending not just for the next five years or even 10 years, of two terms, but extending to 2050 and taking China to 100 years after the revolution.

And if you look for a difference in emphasis, it’s what the Chinese themselves say that with Mao China stood up, zhàn qǐlái. Then, with Deng, it’s fùyù qǐlái, they got wealthy. And now, with Xi, qiáng qǐlái, to get strong.

Now, what does “strong” mean? And that’s what everybody will be watching carefully.

OSNOS: What do you think it means?

LEE: Well, they—he has set it out in his 14 points in his opening long speech, and none of them are completely new, starting with the fact that the party must be fully in charge. And it includes economic growth, it includes environmental considerations, it includes the welfare—the lives of the people, it includes strength internationally, and including strong armed forces. So all the ingredients are there, which any normal great power would have to pay attention to.

What you don’t know if the balance, the tone, and the wisdom with which these elements will unfold. And we will have to wait and see.

With a generation who have grown up through the Cultural Revolution, they’ve known hardship, they’ve known turmoil. They greatly treasure peace and stability. With the next generation, which has grown up during the period of reform and opening up—that means since 1980-ish—and have only seen continuing progress, will they be a generation which you might say, well, now they are—it’s from warriors to engineers to poets and artists? Or will it be that, having not known the turbulence, they will feel that now that I am strong, let me show the world what I can do? And I think that is the big question.

OSNOS: I think—

LEE: If you ask the present generation, they will swear to you that the next generation will make their calculations and know that peace is important. I hope so.

OSNOS: Singapore is one of the largest foreign investors in China.

LEE: According to the Chinese statistics, we are the biggest foreign investor in China. I think that includes other investments which funnel through China, but I take it at face value.

OSNOS: So you’re in an especially good position, then, to help us try to gauge the health of the Chinese economy. There’s strength. There’s weakness. How do you assess it?

LEE: I think there is a lot of energy and vibrance. If you look at it qualitatively, the sorts of companies which are generating the sort of innovation which they are—which is fermenting in Beijing, in Zhongguancun near the university, in Shenzhen, where people come from all over China and start up companies, their mood is not very different from Silicon Valley. And the quality of the people and, in fact, the quality of the companies which are being generated, the technology, they are—they are equal to any in the world. They may not have as many companies which are like Google or Facebook, but if you look at Tencent or Alibaba or Huawei, well, they are not just copying other people’s technology. So I think that the talent is there. The energy is there.

There are structural issues which have to be dealt with—I mean, the SOEs; the taxes; what do you do with the hukou system, the household registration system; what do you do with the agricultural sector; how do you manage your exchange rate and your banks and your loans and debts. But these things take time to handle. On the one hand, having talked to the professionals in the economic management, we know that they have very competent people who understand all this. They think and talk using the same jargon, translated into Chinese, as central bankers and economic managers anywhere. The question is whether you’ve got the right combination of—at a political-economic level. That means in the Politburo or amongst the top leaders, who put this quite high up in their agenda, and can make the political decisions and tradeoffs in order to stage and to manage very delicate transformations which economically are critical but politically are very hard to do.

OSNOS: There’s been a lot of hope that perhaps when Xi Jinping enters his second term in office that they may begin to undertake more of these kinds of structural reforms.

LEE: Well, it could be. I think he’ll have more scope to do that. But I think that he wants to do many things, and he will balance this off against his social objectives, his political objectives. He’s got other strategic preoccupations. If you look at his speeches at the congress, and also when he announced his list, economics is there, but it is not the first big item.

OSNOS: Exactly. We’re going to turn in a moment to the members for questions. But before we do, I need to get your sense of the DPRK. You’ve met with the president recently. This is the crisis of the moment in the region. And I’m curious—you’ve also, of course, got the military perspective—how serious do you think the risk of confrontation, military confrontation, is? And what do you think the United States should be doing to avoid it?

LEE: Well, you always have the risk of a miscalculation. I think that this administration has made some very strong statements, but at the same time they’ve made clear that they do not want to go to war. The North Koreans are not suicidal. They are past masters at thunders and alarums, and not without success. If they are lucky, that’s how you get it—you can get past this hard point. If you are not, you could have a miscalculation. I think so far you have not had a miscalculation. We hope that will continue so.

The difference this time is that they now have more nuclear weapons and they have more powerful missiles, ICBMs. So that raises the stakes. But it doesn’t yet qualitatively and suddenly change the picture, because you have never been able to say you’re completely without risk before the—before the latest missile test.

So it’s up to the United States how you want to respond and what pressure you want to apply to them. You have to apply pressure. You also have to talk. You cannot not talk, because if you don’t talk, you can’t get anywhere. If you only talk, then nothing will happen, because you’ll just be strung out. And you’ve been—you’ve gone through this so many times before.

But to play this game, you need to work with the Chinese and you must—the Russians have to be somewhere in the picture. And most of all, you must have the South Koreans and the Japanese on your side. And if they’re not on your side, you have a hard spot. Even if you want to do something decisive, if the South Koreans are not with you, you can’t do that. So you have to be able—you have to have that diplomacy as well as that realpolitik.

OSNOS: In your comments at the Rose Garden the other day, you mentioned the importance of dialogue.

LEE: Yes.

OSNOS: Are you confident, optimistic, that we may get to dialogue before we get to confrontation?

LEE: I think that is a reasonable proposition. Whether the dialogue will reach an outcome before you have a confrontation, I cannot say.

OSNOS: We’ve got microphones here. And if I may, I’ll just remind you, please, we’ve got a lot of people with questions, and if you can please make sure that we don’t have comments or general observations, but try to keep it as concise as you can. We’ll make sure that we cover as many questions as we can.

And we’ll start right here in that fourth row. Yeah.

Q: William Hauser, Inter-University Seminar.

Mr. Prime Minister, how do you manage the ethnic makeup of your Cabinet?

LEE: How do I manage the ethnic makeup? I choose good people, and I hope that I have a multiethnic Cabinet—(laughter)—which so far has been the case. I mean, we are a multiracial society. I think it is very important that the leadership reflects that, and particularly because our party, the People’s Action Party, has made multiracialism a core tenet of nation-building. And our leadership team within the party reflects that. And therefore, when I choose a Cabinet, I can choose from amongst good people who are Chinese ethnic descent, Malays, Indians, and others. And so far it has worked.

OSNOS: We’ll go right here and then we’ll go back to Ambassador Negroponte.

Q: Thanks so much for taking my question. Is this on?

OSNOS: You can ask it. I’ll rephrase it to the—OK, if we can get a mic over there, that’s great.

Q: Thank you, Evan, for taking my question.

Thank you, Prime Minister. I have—

OSNOS: Could you identify yourself, please?

Q: Oh, sorry. I’m Lynn Kuok from Brookings Institution.

LEE: From Brookings, yes.

Q: Yes. Thank you.

I have two questions. My first question is, do you see the Trump administration as having a coherent—quite apart from the issue of North Korea, do you see the Trump administration as having a coherent Asia strategy? And, if so, what do you see this as being? If not, how do you think it hurts the region and U.S. interests? And what would you like to see more from the U.S. administration?

My second question relates to—

LEE: That’s three questions already.

OSNOS: Let’s start with the—OK.

Q: OK. Very quickly, my second question relates to the Party Congress that took place last week. And I was wondering whether you could share your thoughts and what the key takeaways for Southeast Asia are from that—from that congressional speech. Thank you.

LEE: Well, I think the Trump administration is still developing its Asian strategy, just as it is still developing its strategies on many parts of the world. But we have met your secretaries. Mattis has come out. Tillerson has come out. Vice President Pence has come out. NSC Adviser McMaster has come out.

They’ve said the right things. That has been reassuring. They’ve said that we may be rethinking our approach, but we are not disengaging from the region. And that’s a very important message. They want to do more with the region. They’re looking for a way to do that. And we can empathize with that completely. I think we’re looking forward to hearing the same message when the president comes out in a few weeks’ time.

Your second question, what does Southeast Asia take away from the Chinese Party Congress, I think our conclusion is that they will continue in the direction which they have been going over the last few years. They are confirmed in this. The leadership team is the team which we expected to see. And the key thing is the presidency is still setting in the driver’s seat, setting the direction. And we will continue to want to do more with China at the same time as we adjust to the realities of a very different power balance.

OSNOS: John Negroponte, right here.

Q: Good afternoon, Mr. Prime Minister.

LEE: Good afternoon.

Q: Thank you for coming to speak to us.

My question—I have one question. (Laughter.) It goes to the issue of the South China Sea and the matter of ASEAN unity. And it seems that, on a number of occasions, I can recall at least a couple of ASEAN meetings where there was difficulty in achieving consensus on the South China Sea issue, particularly with regard to a code of conduct with respect to the South China Sea.

Do you see better prospects going forward for ASEAN unity, which would appear to me to be critical in coming—in forging some kind of diplomatic solution to this issue?

LEE: Well, I explained just now why ASEAN countries have different strategic perspectives. And nowhere is this more salient than when it comes to the South China Sea, because in the South China Sea some are claimant states, like Philippines, Vietnam, Brunei, Malaysia. Some are not claimant states but have a stake in freedom of navigation, international law. And that includes many of the other ASEAN countries, including Singapore.

Some have no coastline. They’re landlocked. But they are adjacent neighbors to China, and they do most of their business with China. And they have different—a very different perspective on the issues. So when 10 of these countries are in one group and you’re looking for consensus, I think that consensus cannot be a very encompassing or powerful one. It will be significant in terms of saying we want peace, we want stability, we want to avoid conflict, and we would like to have a code of conduct.

There is no disagreement within the ASEAN countries that we would like to have a code of conduct with China. We have a framework agreed on what the code of conduct should contain. Now the next step is actually to start negotiating this code of conduct, which I anticipate will take quite a long time, because no sovereign country, particularly a big one, lightly commits itself to being bound to certain commitments which it can then be held to, particularly when the status quo doesn’t bind it.

So to reach the point where the Chinese will agree to be bound by a code of conduct—and the ASEANs are happy with what is in the code of conduct—I think this will be the work of several ASEAN chairmanships. We hope to start it next year. I don’t think we will finish it next year.

OSNOS: We’re going to go right there in the second row and Mike Froman.

Q: Thank you very much. Welcome, Mr. Prime Minister. Mike Froman here at the Council on Foreign Relations.

President Obama had the rebalancing strategy. It had a military element, a political element, and, of course, an economic element. And obviously it’s up to President Trump to—he can always change that strategy. He’s withdrawn from TPP. He’s decided not to go to the East Asia Summit.

What advice would you give him as to what an alternative approach for a U.S. strategy toward the region would look like, particularly in the economic area? And the second, or second half-question, is what advice vis-à-vis China would you give the administration in terms of how to be most effective in securing their interests vis-à-vis China?

LEE: Well, we had hoped for the TPP. It is not to be. We move on. I mean, even if Hillary had won, it is not a gone—foregone conclusion that the TPP would have passed. I mean, there would have been a big fight on the Hill. It may have gone through. It may not. Certainly you can’t expect Trump to come in and then fight for this, having denounced it in his campaign. So perhaps it’s better that he makes his position clear up front and then we move on.

What is an alternative to the TPP? I think it is not the right time to start new ambitious trade negotiations. The announced policy of this administration is to work bilaterally. I think the belief is that bilaterally you’re bigger than any other partner who’s likely to come along, and you get a better deal, as a result of which I think not that many partners will be keen to deal with you bilaterally. (Laughter.) Well, you have to—you have to manage that.

I would say in this situation it’s not time to start something new, but do no harm. Don’t take steps which will damage the existing cooperation, the existing substantial trade and investment links which are already there. Let time pass. And maybe in the second term of this administration or the next administration, well, the stars are in a different configuration and we can look for a different kind of deal.

You cannot go back to where you were. That was a particular time, a particular place. Time and tide has passed. You have to find a new alignment of the stars.

OSNOS: Hippocratic oath of international diplomacy.

Jonathan Stromseth right there.

Q: Hello, Mr. Prime Minister. Jonathan Stromseth from Brookings.

You’ve spoken often about the importance of a stable, constructive relationship between the United States and China, for the region as a whole. So the 19th Party Congress just ended. President Trump and Xi will be meeting soon.

I have two questions. First, what are your near-term expectations for that important bilateral relationship? And secondly, as you become the chair—Singapore becomes the chair of ASEAN next year, what can ASEAN do proactively to help, as the preeminent multilateral platform in the region, to really help tamp down a sort of rivalry that may be emerging? Thank you.

LEE: Well, the first question is similar to what Mike asked just now about China-U.S. relations. I think what we hope you will be able to do is not to solve problems overnight but to begin to establish a shared frame of reference, a mutual understanding. How does he think? How do I think? Where are there areas where we can work together? And then, over time, we can work things out.

I think he will try to work deals immediately. You can get them. And I’m quite sure that, on the Chinese side, they will have some ready and you can work some out. But I’m not sure that if you make quick deals with them that you will—first, you will make a fundamental breakthrough; second, that you have the basis for a long-term sound relationship.

You must have a clear understanding—they must have a clear understanding where you stand, and you must know—have some idea of what engagement you have with them. I mean, you will not be able to get his bottom card, but you must have some idea whether you can talk to him, whether you have a line to him, whether this is somebody you can do business with or not. I think that is important.

So when Xi Jinping when to Mar-a-Lago—and there were all kinds of naysayers on how unwise it was of Trump to do this, and so on—but I thought no harm could come from it, because you cannot come to a sudden deal, and it’s good that the two presidents get to talk to one another and understand one another. And I think it turned out well. It doesn’t mean you made a breakthrough, but it was a basis on which thereafter they can talk about many issues. And I understand they ring up each other quite frequently and there is a line. You need that line.

One of the things which Henry Kissinger regularly laments is that the Chinese have a strategic view and the American presidents don’t. And to some extent he’s true—he’s right. He’s right. But there is an exculpation, which is that an American president cannot commit his successor.

So, short of committing your successor at the beginning of the term, you have the chance to set the tone and to establish an understanding, what are you trying to do, and then let’s work together. We have four years in which to work at that.

The Chinese tell us explicitly that they are looking at the new administration, that this is an administration which they say gōnglì zhǔyì, which means utilitarian, but what it really means is that we’re just looking to deal with items one by one. And they’re not quite sure how to figure you out. And they’re looking for a way to understand you. So if you find them inscrutable, you must realize that Westerners can be inscrutable too. (Laughter.)

OSNOS: Yeah, we’ll go right there in the middle. Yeah, second row from the back. Sorry. No, just towards the back there. Yeah. Thank you.

Q: Thank you, Mr. President. Sherri Goodman at the Woodrow Wilson Center.

Can you discuss Singapore’s interest in the Arctic and your own personal view about how a changing climate is affecting Singapore’s security?

LEE: We are keeping an interest in Arctic matters, meaning we would like to know how things are developing. We have joined the Arctic Council as an observer, and we are quite an active observer. And the reason is, if the northeast channel opens up and you can sail from Europe to the Far East via the Arctic, north of Siberia, that is a shorter route than going through the Suez Canal and Southeast Asia. And we’re in Southeast Asia, and we’re an important port. And if a shorter route opens up, we want to know about it. (Laughter.) So that’s very important.

Q: And climate change?

LEE: Sorry. And climate change? Climate change is something which we see all around us. If you ask the scientists, they will show you CO2 charts which are really completely unambiguous. They will—you can see the global average temperature charts, not quite so unambiguous, but very, very persuasive. And you can see typhoons and hurricanes.

And in Singapore we don’t have typhoons and hurricanes, but we do have sea levels which rise because we are low levels. We don’t have mountains. We have at most low hills. And we also see more extreme weather events; so rainfall which is more intense, leading to flooding. And I expect we have seen one or two, so we’re not sure, longer periods of more intense drought, which will put stress on our water-supply systems.

So we are watching this very carefully. If things happen on a 100-year timeframe, we have time to respond, because we are just, well, less than 300 square miles. If I need to raise my land levels by a meter or two, well, I think I can find ways to do that. If it happens faster than that, well, we will have to scramble.

OSNOS: Let’s take another question towards the back and then—yeah, right in the next row there. Thanks. And then we’ll come back up front.

Q: Hi. Thank you, Mr. Prime Minister, for being here today. Andrew Lowenthal with Event Driven News.

I was just wondering if the Singapore business community, broadly speaking, has felt a chill with respect to doing business in the United States, and whether they feel the U.S. is still as open for foreign partnerships and investment as it was previous to this administration. Thank you.

LEE: I haven’t had specific negative concerns. We watch carefully your counter—well, your trade measures. Actually, they are countertrade measures, so when you have antidumping cases or countervailing duties, we watch because we don’t want to be caught up as collateral damage. It can happen.

Investments-wise, you always had various CFIUS restrictions. I’m sure they are still there. I have not noticed any recent cases. We have had cases before which we have had to work through with previous administrations, and fortunately were able to work out.

OSNOS: Let’s go right here to the third row. Thanks—towards the middle.

Q: Hi. Stanley Roth, retired. Good to see you back in Washington.

LEE: Hi, Stan.

Q: My question is one based on a premise that I hope you can solidly refute, and it’s a premise that you offered last year, which was that TPP is inherently strategic. As valuable as it is economically, the strategic benefit is greater. Many observers, including myself, fear that you were right and that there’s been a major diminishment of the U.S. strategic position in the region, and not just talking about ASEAN. You know, I won’t go all examples because of time, but Australia with Turnbull—

LEE: Yes.

Q: —people talking about reliability, what’s happened in the Philippines, Malaysia seeming a lot closer to the region; problems on the reliability of alliances based on some of the things about burden-sharing, threats to KORUS, I mean, on top of TPP. Is it really unfair to say something we don’t want to see, that you were right, and that, as a result of TPP not going forward with the United States, that the United States is perceived, at least, in the region as having a diminishing position, beyond the inevitability you talked about of a rising China?

LEE: Well, I think the—I stand by what I said, that the TPP was as valuable strategically as economically. The economic dividend was there. The strategic dividend goes beyond the participants in the TPP. It is a way to link both sides of the Pacific and to strengthen the considerable rationale, which already exists, for America to be focused and engaged in the region.

But it is not to be. It is not to be. You’ve lost the upside. It can’t be helped. We will move on. It is not to be. Is there an impact on American credibility when you negotiate? Well, I don’t think you can measure that, and you won’t be able to see that overnight. But I’m sure that when you want to enter a negotiation with any party, and it’s to end in a treaty which needs confirmation and which will be politically difficult, they will—the partner will first have to make an assessment: How serious is this government of the United States, and will it see it through? And if it doesn’t, is it worthwhile spending hundreds of hours and efforts to try and reach a deal which may be politically spiky at home in our countries? And then, finally, it doesn’t go through, and what was this for?

So you can never measure these things. It’s like when you draw a red line and then you don’t take it seriously. Was there pain? You didn’t see it, but I’m quite sure there’s an impact.

OSNOS: Sorry. We’ll go over here, right here in the second row. Thank you.

Q: Thank you. Paula Stern.

You mentioned India once. And I would be very interested in your elaborating on what role you think India can and will play vis-à-vis the strategic relationships between China and the United States. In other words, is there a bigger role that we will be seeing India play?

LEE: Well, India’s population is almost the size of China’s population, and it may even possibly overtake China’s population. Its economy is at a lower level. It’s about a third the GDP of China in per capita too. Its foreign trade is a fraction of the Chinese. It’s one fifth of what the Chinese are. So in terms of economic heft and international influence economically, it is not where the Chinese are. And I’m sure your trade figures with China and with India will bear that out.

From the point of view of the architecture of the region, we have long believed that India has got a very constructive and important role to play. And that’s why, when the East Asia Summit grouping was formed, it included all of the ASEAN countries in Southeast Asia. It included the Northeast Asian countries, China and South Korea and Japan. But it also included India as a major participant, and Australia and New Zealand for good measure, because—that for a different reason, because Australia and New Zealand, they are U.S. allies. And a grouping like that is not likely to turn hostile to the United States.

For the same reason, when we talked about trade agreement on the western side of the Pacific, what we call the RCEP—if you are not in the business, you never have heard of these initials. They mean something. And it’s basically ASEAN, Northeast Asia, and India—again, because we wanted India to be an active and constructive participant, bringing to the table something extra, which—and balancing the overall picture.

So in principle, conceptually, when President Trump says he’s going to go to Asia and he’s going to make a strategic policy speech and talk about the Indo-Pacific, that is the right shape. The question is, what exactly will the Indian government do? Where is their priority focus? To what extent are they able to reorientate themselves from the subcontinent externally towards the region and open up and use trade as an instrument of policy, just like the Chinese do, just as the Americans have done in a strategic way, and therefore played a full role in the region.

And that is something to be seen. We are hoping that with Mr. Modi and—I think first they said Look East. Now they say Make East—Act East policy. That will mean something, and it will mean a greater integration of India into the region. But it is yet to be seen.

The format in which the meetings take place, in fact, is the East Asia Summit, which is, together with the ASEAN meetings, and unfortunately President Trump is unable to make it to this year’s East Asia Summit meeting. But actually that is the forum which could give—which gives body to the idea of an Indo-Pacific community. And we hope that although he can’t make it this year, in future years he’ll be able to come. Next year we are hosting it. (Laughter.)

OSNOS: All right. Let’s go back right there in the middle, about five rows back. Yeah, right there. Sorry, just behind you. And then we’ll come to you there at the front. Yeah.

Q: Thank you very much.

Thank you, Prime Minister. My name is Dong Huiyu (ph) with China—(inaudible)—News Agency of Hong Kong.

I still remember three years ago right here. I asked you a question about Singapore’s role in helping cross-strait dialogue, and you said Singapore will be happy if they want. And we did see the Xi-Ma meeting in Singapore one-and-a-half year(s) later.

So right now the situation has changed. The communication has been suspended. What do you think Singapore’s role in this regard to resume the dialogue between the two sides? And what’s your suggestion for Beijing and Taipei to break that deadlock, particularly right after the 19th Party Congress? Thank you very much.

LEE: I think we have a very limited role. We hosted the Xi-Ma meeting in November 2015. Our job was to provide the room and the teacups. (Laughter.) That’s it. It’s their meeting. We were a neutral venue. They were both comfortable to come to Singapore and hold a meeting here, and we were very happy to be the host and to have some spillover glory. They couldn’t very well hold it in Shanghai. They can’t hold it in Taipei. They don’t want to hold it in Hong Kong. So Singapore is a neutral place. And I think that that is a useful—and we are friends with both sides, and therefore it could happen.

What prevents it from happening now? I think that there’s a basic difference in perspectives and trust between the two sides, because words matter a great deal, abstruse as they may be. The 1992 consensus, whatever that means, was the basis on which the Chinese—China did business with KMT in Taiwan.

And now Tsai Ing-wen for the DPP has decided that she cannot use those words, and she wants to find some other form of words which are different, supposedly the same, but obviously, to her own supporters, closer to a green position, and therefore ever so slightly friendlier towards a separate Taiwan. And the Chinese have said no. I mean, it doesn’t matter what it is. This is what we agreed on. This is what we will stay on.

And I can completely understand the Chinese position, because if you accept the new form of words, you can’t go back to the 1992 consensus anymore. And by salami tactics, one day you will get very close to somewhere where you don’t want to be. So that’s a very hard contradiction to settle. The Chinese cannot move. I cannot see Tsai Ing-wen going back and saying I agree to the 1992 consensus, in which she will lose all credibility and support from her base. And therefore you are at an impasse, and the best you can hope for is just a standoff and things do not get worse.

I mean, things can go wrong, and the Chinese are building up their armed forces, including aircraft carriers, in case things one day go wrong. We hope that day can be put off.

OSNOS: We’ll go right there to the—

Q: Thank you, Mr. Prime Minister. Henry Nuzum, Seacor Holdings.

Your grasp of detail is very detailed, and contrasts with heads of state—some heads of state in this hemisphere. (Laughter.)

I have a domestic political question for you. You stated that in politics no party remains in power forever. Does that apply to Singapore?

LEE: Yeah, I’m sure it does. I don’t know when it will happen, but I will not want to make it happen sooner than it needs to. (Laughter.)

OSNOS: All right, let’s go over here. Right there at the end. Yeah.

Q: Thank you. I’m Frances Seymour with the World Resources Institute.                            

And I’d ask you—like to ask you to elaborate on your answer to the previous question in which you articulated Singapore’s interest in the challenge of climate change and wonder if you would be willing to share with us the—whether and how the issue of climate change has factored into your bilateral dialogues with countries such as the United States and its announced withdrawal from the Paris agreement or with Indonesia and its recurrent forest fires, which also have more direct collateral damage on your country. Thank you.

LEE: Well, I have not discussed it with Americans bilaterally. I’m not sure. Maybe my environmental officials would have surely touched base with their equivalents, counterparts. We were active discussing the matter in the Paris talks and helping to shape the consensus which came up.

And we think that it is a serious global problem and one which cannot be solved without the major emitters, which includes the U.S., China, India, and as well as the BRICS. Singapore will do our part. I used to say that even if we all stopped breathing in Singapore, it wouldn’t save the climate—(laughter)—because—(laughs)—we’re so small. But we will do our part. We can’t do—we can’t go beyond that and fall on our sword, but our share we will do, which means bringing down emissions from business as usual and peaking by 2030.

With our neighbors, with Indonesia, the question of haze is to us a question of direct pollution. It’s not a climate-change thing. It is just direct particulate pollution of the environment. Instead of fresh air, you’re getting unhealthy smog. And that affects many countries in the region, and it’s something which the ASEAN countries are working together in order to overcome, and which I think this Indonesian president, Jokowi, is taking very seriously. And it has had an impact in Indonesia.

I mean, we’ve had a better year this year. Partly the winds have been favorable. But I think, significantly, it is because the president has put officials’ jobs on the line and taken a very personal interest and shown that even in a big country you can get definite things done if the boss pays enough attention to it.

There is a climate-change angle to these forest fires in Indonesia and in other countries. In bad years, when the fires cover thousands of square kilometers of forest—and not just the forest, but the peat land under the forest, which has dried up and become very combustible—you’re talking about CO2 emissions in the order of gigatons and equivalent to the CO2 emissions of a country like Germany.

And you don’t get any joy out of that at all. I mean, it’s not that you needed it to warm your house or to drive your car or to power your office computers. It just went up in smoke and is causing a problem with global warning. So it is a very serious problem which has to be addressed.

OSNOS: I’ll use just the prerogative of the moderator to ask one last question about the leadership of Singapore. You have said before that you may not stay in office after the age of seven (sic). Do you have thoughts—70. Do you have thoughts about the next prime minister and anybody—

LEE: Well, I just answered the question on CNBC, so you can look it up there. (Laughs.)

OSNOS: What if we don’t subscribe to CNBC? (Laughter.)

LEE: Well, my aim is not to be prime minister beyond 70. I’m trying very hard. I’ve got a team and Cabinet. I’ve got strong people on the team, and amongst themselves they have to take a little bit of time to sort out who should be the next leader.

OSNOS: Well, we hope that you will come back, in any case. And we want to thank you again for your time today.

Please join me in thanking the prime minister. (Applause.)

LEE: Thank you.


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