Questions and Answers
[Masahiko Aoki] Thank you, very much Premier Goh for a very insightful talk. Under title by "Challenges For Asia," he started to talk about, first - unprecedented preeminence of U.S., and then secondly - he talked about the rise of China, and third - he talked about political discontinuity in Indonesia, and then finally, he proposed that EAFTA can provide a framework for a region that ensures economic prosperity and peace. This was quite an insightful speech, I think. And it is a tradition at the RIETI to have a sort of free interactive question and answer sessions after each speech, and Premier Goh kindly agreed to receive questions and comments from the floor for about 30 minutes. I think that there are quite a few people who want to raise questions, so please limit your questions, let's say, to 3 to 5 minutes at most, and please identify yourself first before asking questions. So please raise your hand.
[Dan Sloan - Reuters] Prime Minister, I'm Dan Sloan with Reuters. Sir, two points that came to mind immediately after your speech. One is, with the issue of globalization - one facet of this has been exposure to issues, particularly, such as the health scare right now with the virus. Can you talk a bit about measures that Singapore is taking in regard to this or issues like that? Secondly, in relation to your comments about North Korea - today Japan launched two spy satellites intended to some degree monitor developments in North Korea. However, some see that this perhaps will precipitate some kind of action by North Korea. How does Singapore view the use of satellites in the situation in North East Asia?
[Prime Minister Goh] OK. To the first question as to how Singapore responds to globalization - ours is very simple, and is one which arises from having no choice. Now, we are a small economy, small country, we need to trade. So when we see the trend towards globalization, we decide that we have to embrace it, seize opportunities that come with globalization, and of course, we know the pollutants that also come with globalization. We should therefore, take steps to minimize it.
And you refer to the viruses, and I can discuss this as an example of how we deal with it. Well, we still need tourism into Singapore and Singaporeans' to still travel. So we can't say, because of viruses in Hong Kong, Guangdong and elsewhere we do not allow Singaporeans to travel, but we advise them just to take care, and avoid places which may get them into contact with potential problem. And likewise in Singapore, although there are travel advisories in some countries against traveling to Singapore, we've got to project the image that we are dealing with the problem in a very transparent manner. We will let people know the numbers, the sources, the problems; and openly discuss this, so that people from outside will know that there is a problem in Singapore, but it is not a national problem. We close schools, not because medically it's the right thing to do, but because we have to assure the parents that the children going to school may risk the contact. We tell them that we are closed for 10 days to try and break the cycle in this virus which can cause atypical pneumonia.
So, this is an example of how we deal with globalization. We see the positive part and we see the negative part, and we maximize the positive benefits we try to minimize the difficulties. Our approach to trade is in the same way. We don't try to protect the economy, because if we do, the costs are too high. We open up and do an FTA. with Japan. We now will see some Japanese doctors and dentists in Singapore to compete against Singapore doctors and dentists, but that is to be welcomed because we can also compete with them in Japan. Indeed, trade between Japan and Singapore has grown since the signing of the trade agreement, and that could be attributed to the Free Trade Agreement.
Now, whether Japan's sending up the spy satellites precipitate further action by North Korea. Have a look at it the other way, even if Japan doesn't send out a spy satellite, I think North Korea has a will of its own. You know, it has proceeded with the nuclear, what do we call it, the nuclear enrichment of plutonium, for its own reasons. So I do not see how this can affect, but it would reassure Japan, and maybe the world, that somebody somewhere has some intelligence as to what is going on in North Korea. I find that reassuring.
[Naoko Munakata - RIETI] Thank you. Naoko Munakata, Senior Fellow of this research institute. My question is, in our proposal on East Asian Free Trade Area, it is important to have a common vision of East Asian integration, but the regional economies or countries seem to be talking regional but acting bilateral or sub regional, and there are reasons for that. There is not the political cohesiveness in the region, unlike Europe or Americas. That's the problem.
And then, the other thing is that the sequence towards this East Asian integration can be contentious. For example, countries with high level of preparedness and capability to implement what's been agreed, like Singapore, Japan, and maybe Korea, can inform starters and then welcome the rest of Asia, offering assistance to negotiate and implement whatever, but that may look like encircling China, based on this mutual suspicion about the mutual strategic intention. So how do we solve this puzzle? That's my question. Thank you.
[Prime Minister Goh] If we have just vision and imagination alone, and no concrete means to realize this vision, then we are living in the clouds. So, but if we just have concrete steps to resolve immediate problems without having a vision, then it is very pedestrian in your leadership. So, we've got to find a way to combine vision with reality of the situation. One can argue, which shall come first - whether we should have political view and political cohesion amongst all countries before we talk about vision. Ideally, I think that should be the case, where in reality it's not possible for one of the reasons given by you - that countries and economies are at different stages of development. Some which are less developed are less confident about this openness in this integration of the economies.
So what I hope to do is to project a vision for the future as a medium term, maybe even long term, goal and tell countries within the region, this is the ideal situation, this is where we should be heading.
Now how do we arrive at that situation? So we talk bilateral. Now we cannot talk multilateral. If we talk about East Asia Free Trade Area now on a multilateral basis - meeting of ten ASEAN countries, plus three - the North East Asian countries, plus Taiwan as an economy, plus North Korea, you would get nowhere.
So we say, let's proceed bilaterally and we actually thought out the steps we would take. We persuaded Japan to do bilateral FTA with Singapore because it is easy to do. Our economies are complementary. Yes, we impact on the agricultural sector but they can live with the impact of tropical fish and beautiful orchids on their agricultural sector.
So we did one. But we knew fully well then, that when Singapore did this with Japan, people could see that we had an advantage over them, and indeed very quickly it balances.
What about me? Malaysia who criticized us roundly for having an FTA with Japan, say, 'what about us.' Now I understand from Japan that they are talking to Malaysia, and Philippines will follow soon.
So, from a single bilateral we've moved into several bilaterals. And China could see the move of Japan in talking to Singapore. It's not Japan and Singapore FTA. alone. We are such a small economy compared to Japan. But Japan is eyeing ASEAN.
So, China says how about an ASEAN-China FTA. China, they are desperate to assure ASEAN that as its economy grows it is not going to overwhelm ASEAN. It is telling ASEAN leaders that 'As I grow please come in and take advantage of my growth.' It is a comforting move by China. ASEAN took one year to ponder over this proposal by China, and decided to proceed with the negotiations with China.
And Japan saw China moving faster than its bilateral approach, so Japan says "How about not an FTA, because it's not doable. Instead, how about a comprehensive economic partnership with elements of FTA?" Well, South Korea who went to them was not very interested; it's now talking to Singapore about a bilateral FTA.
Now when we have all these, these are spokes moving towards ASEAN and Singapore.
One spoke from China to ASEAN, one spoke from Japan to ASEAN, through Singapore. But that is going to divide East Asia, when you have China and Japan contending for the love of ASEAN. You know, this is a situation where we don't mind many lovers; I think the more, the better, you know, just to say. But at some part of time, we have got to link them together, so it's East Asia Free Trade Area. We will link all these economies together into one whole. So, we take a building block approach or a bilateral approach to achieve the endgame of an East Asia Free Trade Area. But would that be good enough? Free trade area is just about trade in goods, maybe some services. I say no, the ultimate goal must be an East Asia community somewhat similar to European Union. Would you arrive at a situation where there will be free flow of people? I think probably not. Because Singapore will be fearful that if we do so well, we may end up with population of 20 million, which is impossible to support. So, there are certain areas where we may not go the way of Europe. But will we arrive at a common currency for East Asia? I think that's a possibility but we've got to sort out which currency is stronger. Is it Renminbi or is it Yen? We do not know, but time will tell. In 20, 30, 50 years' time, we may sit down and say, which is the currency we should use as the common currency for ASEAN or for East Asia. It may not be the Renminbi it may not be the Yen, it may be a new currency. The Euro, as it has been for the European Union, maybe for Asia, it's the Asio or something like that, or some Japanese sounding word. I see all these as a possibility, so dreamers must dream 50, 100 years ahead, but dreamers must also know what to do in order to take steps to realize the dreams. So, we hope that the Institute and Singapore, we are both dreamers, as well as real life operators.
[Kusaoi - Foresight Magazine] My name is Kusaoi. I'm editor of Foresight magazine. As you mentioned, the challenge President Megawati faces, regarding radical Muslims. What is your view of the message the ongoing war in Iraq is sending to the moderate Muslim people in South East Asia? And also, aren't you afraid of some repercussions, as Singapore had experienced an attempted terrorist attack last year? There must be more. Those are my questions.
[Prime Minister Goh] I want to end up my earlier answer with a point of my encircling China which was implicit in my reply but I did not make it explicit. So when you talk about EAFTA China is part of it, therefore, the encircling of China does not arise. The position on South East Asia, in particular, on Indonesia, of the ongoing Iraqi war, you would have noticed that the reaction or the policy stands on this issue differed between Singapore and the Philippines, and Malaysia and Indonesia, and it is obvious that Indonesia and Malaysia, they have predominantly Muslim population. Singapore has a large Muslim population, 16 %, which is large. Philippines, also, I think fairly large, but mainly, in the southern part of the Philippines. But why did Singapore take the position which is different from Indonesia and Malaysia? This is because we view this as an issue of weapons of mass destruction. It is not an Islamic issue. The U.S. did not go into Iraq to destroy Islam. It is not in the Iraq to hit out at the Muslim country. It is clear to everyone, unless that person wears blinkers, that this is a war to remove the weapons of mass destruction from Saddam Hussein.
And Saddam Hussein has a prior record of using weapons of mass destruction. So what was the concern of Singapore? What is our foreign policy or security stance in this? Well, we do believe that Saddam Hussein would have some biological or chemical weapons of mass destruction, not nuclear weapons. And we do believe that there is a high possibility of these weapons getting into the wrong hands, that means, the hands of the terrorists. We do believe that when they get into the wrong hands of the terrorists, they will be used to hit out at Americans and friends of the U.S. And whilst they may not hit out at Singapore as Singapore, they may hit out at American and Western targets in Singapore. And two years ago, we actually had this, I would say, nasty experience of feeling that the whole country was nearly blown up. The terrorists were targeting to set off seven bombs, truck bombs simultaneously at seven different locations - U.S. Embassy which had the British Embassy and the Australian Embassy nearby, High Commission nearby. So with one truck bomb they could blow up three embassies.
They were targeting some offices with American companies, of course, staffed mainly by Singaporeans not Americans, and they were targeting subway stations where the Americans would go to take their transport home from school or to the places of their work. They monitor all this. Well, some Americans can be killed, but many Singaporeans too, would have been killed. So, from that real life experience that there was an actual terrorist threat, which had it been perpetrated, would have blown up seven different places in Singapore; and seven different places in Singapore meant the whole country, because we are only 600 square kilometers. Can you imagine the shock to the whole population? So, we take this thing seriously. We say, well, get the weapons of mass destruction removed from Iraq, and its not just Iraq per say, because we know that if the U.S. feels to stand up to Saddam Hussein, how would U.S. deal with North Korea? How would U.S. deal with the terrorists? They are going to have North Korea building more weapons. They are going to have the terrorists running around all over the world.
We say, this is very dangerous. Better go with the U.S. and we were able to convince our own population, including our Muslim population, that this is not an Islamic issue of the West trying to hit out at Islam; this is an issue of security for us. So, in our national interest, we took that position. Now, I believe that the moderate Muslims in Indonesia, and also Malaysia, understand this. If you look at the reactions of the Indonesians. They allow demonstrations, but they have managed to keep it as peaceful demonstrations. President Megawati and the Muslim leaders must criticize America for attacking Iraq out of their own belief, and out of the fact of political necessity. If they are with the U.S. on this issue, they are not going to win the next election in 2004. So, they have to criticize and therefore, allow the people to demonstrate against the U.S., but they have made it a point that it must be moderate demonstration. And likewise, in Malaysia. Malaysia had been more outspoken on this issue, but Malaysia had banned all demonstrations except one, which is organized by the government. So, when you have demonstration organized by the government, things cannot go wrong. If they go wrong, I think there will be deep trouble. So, you can see how the Muslim countries have to react in the Muslim way, because they must show that they are against the attack by the U.S. on a Muslim country, even though they know it's not against a Muslim country per se, but Iraq happens to be a Muslim country, and Muslims happen to be killed. But, we can understand the sympathy of Muslims for the Muslims in Iraq, because civilians do get killed in the war. But, we take different positions out of our own national interest, out of our own calculations regarding the future of our own security.
[Yasuhiko Nara] Thank you. My name is Nara. I happened to be Ambassador to Singapore for three years from '69 to '72. So I'm going to limit my question to Singapore itself. The main question is, how in the world have you made such a small country into such a beautiful and world's most successful economic entity. Frankly speaking, when I was transferred to Singapore, my post was in New York Consul General, in the largest city in the world. Being transferred to the smallest country in the world, in those days - of course, there are smaller ones now, but in those days Singapore was the smallest - I was very, very disappointed. Why should I go from the largest city to the smallest country in the world? But, during that time, you had made this country so well. It is entirely due to your leadership I believe Mr. Prime Minister Goh Chok Tong and also your predecessor Lee Kuan Yew, and I wonder if you can give us your secret of developing a country to this extent, because you know we don't have Goh Chok Tongs and Lee Kuan Yews in Japan. They are all terrible, even my best friend Miyazawa has been able to become Prime Minister. I am going to play golf with him tomorrow. I am going to tell him, but unfortunately, we don't have you Goh Chok Tongs and Lee Kuan Yews and I work with Meryll Lynch and, my office is there. Everyday, the rooms are vacant. He hasn't done, Koizumi hasn't done enough to revitalize the economy at all. So, what is your secret of developing a new country to that extent, that's Number 1. Number 2, my short question - your relation with your neighbor Malaysia. I have seen your picture drinking water from sewerage. I don't know how you can manage it, but how are you going to do it from now on. Thank you.
[Prime Minister Goh] You know, I ask my Ambassador here and Ambassador Nara is another old friend; I've met him several times in Singapore. I ask my Ambassador here, I say, supposing we put Lee Kuan Yew into Japan, would he succeed in leading Japan? I ask him that question. This is absurd. I say why? It is the system. They say Lee Kuan Yew would not survive the political system in Japan. So, I think one question is well - the system of politics and government in a country determines the kind of leadership. The next, I think you have put your finger on the pulse; it is quality of the leadership. And I can say this because I am not referring to myself. But, I am referring to Lee Kuan Yew and his colleagues. They were the ones who built up Singapore and they understood the meaning of superior leadership in a country. He'd always use the analogy in order to persuade younger people like myself and my foreign minister to join politics. He was happily teaching law, carrying his books, walking in university, law professor, very respected, and I was quite happy running a shipping line. Well, he persuaded us. He said, 'If a country's cabinet is weaker than the board of a multinational company, then what chance do we have?' And he quoted, you know, the board members of several American and European MNCs. He said, just one company's quality of board members for their company is far superior to the quality of the cabinet of many countries. If the Singapore's cabinet is not equal even to the board of a company we have no chance to survive. We felt quite privileged that we were regarded as potential board members so we decided to join but the way we were persuaded was this: He told us, 'If you can't join me in the People's Action Party to carry on this governing of Singapore, who else will you have? Who would you recommend and under who would you like to live and your children to live.' So, we thought it over, and said, it's better that we come in and have a go at government. So the essence of this story is, as we now have imbibed from his wisdom, is look at the whole of Singapore as a potential recruiting ground for leaders in government, so, after every election, we scour the whole of Singapore - universities, business establishments, civil services, armed forces, police and so on - and attract those with the intellectual competency, possibility.
But that's only the first part. The more important part is to gauge the character of a person, the dedication, the drive, the energy and then this question of imagination versus a sense of reality. If you have ideas, but no sense of reality, you cannot be a politician in Singapore, because you can't deliver. If you have a sense of reality, but you have no vision, then, you can't lead. So, we set out to acquire people to come into government, and we are the second generation leaders of Singapore. We are fortunate, because when Mr. Lee and his colleagues built a house of Singapore, they already imagined the several storeys that could be built. So, they laid the basic foundation, and framework, for us to build. So, we came the foundation was steady; the architectural plans were there. We built in accordance to the plans which could be modified as world circumstances change. So, when it changes, you modify the design, but the basic framework is there. By the framework, I don't mean the physical framework alone; it is the philosophy, it is the values.
So, one value is integrity of the government. Be open with the people, whether they are right or wrong, whether we have made a mistake or not, be open. If you have made a mistake, recognize the mistake, but also give solution on how to rectify your mistake.
The other value that we have is meritocracy in government, in civil service everywhere. So, we appoint our ministers. Fortunately for us, we don't have to appoint them in accordance with connections, but in accordance with their ability. So, we do get a set of good people to be in charge. If we have the system right, we have the people right to run the system. Then we have a good chance of keeping Singapore going.
But, in essence that's one of the factors. I do not want to neglect the importance of the people. Our people the western press will criticize; they are very obedient, very compliant, but they are not. If we run the wrong policy, we get trouble from them. But, because our policies are right, they listen to us. They are regarded as compliant, but they are not compliant people. So, the people work hard. They are able to understand the arguments, they follow their leaders, and that's how we are able to build Singapore.
But, our problem is not now, but when we look at the future, we now wonder how to continue with the growth path for Singapore. It's not easy, but already, I have identified my successor so the Prime Minister in waiting is there, and he doesn't have to wait long to take over. So that's our system. But, I don't wait until I am decrepit or until I'm kicked out. At the prime of my power, or success, I will step aside, next man will take over. That's how we run the system.
Second question is, Malaysia relation. Oh! That's very complicated, and is very simple. Now, water has become a strategic issue between us because we buy most of our water from Malaysia, and it is a good tool which Malaysia has. It therefore became a strategic issue which could cause problems between us. So, we have decided that, is this the way to run the relations over the long term? We said no. Over the long term, better be as self sufficient as we can in supplying our own water.
Well, we can desalinate because we are surrounded by the sea. We will never be short of water, but that may be expensive if you use desalination for the water supply. Then, we did research. We discovered this new membrane technology, which could filter your water from the sewerage, recycle water, and the standard is higher than WHO standard. So, we have done it on the quiet for the last few years. Then we called in the consultants from the U.S. We interviewed the people who monitor the quality of the water. We were satisfied that it is indeed pure, it is indeed clean, and it is indeed potable and drinkable. So, we therefore, and, of course, as the Prime Minister, if I don't drink it, who else will drink it. So, after a tennis game, I took a bottle of recycled sewerage water right from the loos; we drank it. Well, we are now having people coming to Singapore from other countries to learn from us, because it is indeed a well accepted technology, which the Americans in certain parts also use - in Orange County, in Florida, in Europe too, they have been doing this for years. So we say OK, it is psychological. But, who helped us to get this recycled water accepted by the people? Malaysia. And we thank Malaysia for it, because Malaysia was hammering us on the issue. Singaporeans, they say, "To hell, we drink this water." That's how we have got the new water accepted by the people without any problem.
[Aoki Masahiko] This is probably a good topic to conclude this session. Unfortunately, our time to conclude has come, so please join me in applauding him for thanking him for excellent speech, and continuing leadership in ASEAN integration.
[Prime Minister Goh] Thank you, very much.
