Trade wars bring suffering and kill too without directly firing a shot to end life.
Trade tariffs and barriers will not being world peace.
So long as there are greed and ego due to materialism and profits, there will be no world peace.
So long as the West holds the belief that they are superior than the East in space technology and science, economy, education, health care, way of life, etc. rather than both be complementary, there will be no peace.
The UN should bring both to jointly fund and research into making mega cities become 100% users of clean and green energy now, replacing fossil oil, LNG and coal not in 2030, 2050 or 2070.
When all mega cities do not pollute anymore, it will transform the whole world.
When China’s top 10 mega cities become 100% users, it will bring impact on others around the world to buck or be left behind in competitiveness.
Will China research into tapping lightning power, creating artificial lightning, and transmitting clean and green electricity from outer space to earth for use in their mega cities to replace fossil oil, LNG and coal, even nuclear?
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The Straits Times’ Editorial says
Seize opportunities from RCEP
PUBLISHED 3 HOURS AGO on 6th Jan 2022 in ST.
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Ten years after it was conceived at the 2011 Asean Summit in Bali, the world’s largest trade pact – covering some 30 per cent or US$26 trillion (S$35 trillion) of global gross domestic product and 30 per cent of the world’s population – kicked in last Saturday, slashing tariffs for businesses for about 92 per cent of goods traded among parties for which the Regional Comprehensive Economic Partnership (RCEP) agreement entered into force. They are Australia, Brunei, Cambodia, China, Japan, Laos, New Zealand, Singapore, Thailand and Vietnam. The pact will enter into force for South Korea on Feb 1. Indonesia, Malaysia and the Philippines are expected to ratify it soon, while Myanmar’s ratification is pending acceptance by other members.
The RCEP is also the first time China, Japan and South Korea are in the same free trade agreement (FTA). It covers areas such as intellectual property, competition policy, e-commerce and government procurement. Being a signatory confers advantages. Besides tariff elimination, businesses benefit from additional preferential market access for products, including mineral fuels, plastics, other chemical products, miscellaneous food preparations and beverages in markets such as China and Japan. Some estimates suggest it will remove tariffs on 86 per cent of Japan’s exports to China, up from 8 per cent of goods that are now tariff-free. Japan’s tariff-free exports to South Korea will also grow from 19 to 92 per cent.
What does this mean for Singapore? Businesses will have more flexibility to tap regional supply chains and source for inputs from any other RCEP member. Before this, they could tap only existing Asean Plus One FTAs between the group and individual dialogue partners such as Japan, South Korea and China. The commitments made on e-commerce, digital services, intellectual property protection and dispute settlement also align with Singapore’s objectives to be a global hub for the knowledge economy. Small- and medium-sized firms stand to gain too, as the digital economy today still presents them with significant barriers to cross-border trade.
The RCEP will also make it easier for investors to finance projects, as it includes commitments to prevent performance requirements – set by host states requiring investors to meet economic and social goals – from being imposed on them. Overall, it would be especially useful for Singapore’s fintech, clean tech and logistics sectors.
But companies need to do their homework to determine the exact benefits – which may be product-specific and not industry-specific. The RCEP opens opportunities, especially given the challenges of a pandemic-hit global trading system. But to take full advantage of it, firms should review existing supply sources, explore new markets and identify where they can secure a competitive advantage in this fast-growing region.
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Triangle…
What is a perfect triangle and what is not?
Is the pyramid shape a perfect triangle?
Why humans built the pyramids in ancient times?
Was it due to they had nothing better to do?
In modern trade world wide, what is a perfect multi-trading triangle?
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The multilateral triangle
The Biden administration’s commitment to strengthen the rules-based order is laudable and it has no better partners than the EU and Asean. All three parties need to act fast.
Kishore Mahbubani
To succeed in its quest to strengthen the rules-based order, the Biden administration will need partners.PHOTO: AFP
PUBLISHED2 HOURS AGO on 14th August 2021 in Straits Times.
Bus rides can provide settings for great conversations, especially bus rides at major international conferences. In the egalitarian setting of a bus, the high and mighty can end up sitting with the hoi polloi.
So I once ended up sitting by chance next to a mighty gentleman who had once served as the chair of the National Intelligence Council of the United States. He had just heard me expound on the virtues of multilateralism, a cause I deeply believe in.
He said to me: “I can understand why a small state like Singapore supports multilateralism. It enhances the influence of small states. However, for a great power like the US, multilateralism is a great constraint.”
I deeply appreciated his honesty. It captured well the ambivalence of the US towards multilateralism.
On the one hand, most of the 1945 rules-based world order that the world functions on today is the gift of Western leaders after World War II, especially American leaders and scholars.
Much of the content of contemporary international law comes from the work of US scholars (including great ones like Louis Sohn and Thomas Franck, both of whom I met in New York when I was serving as Ambassador to the United Nations).
Indeed, Thomas Franck, in his book Judging The World Court, notes that “in 1945, America seemed on the verge of decisive commitment to the multilateralist vision”.
Yet, as indicated by the former chair of the National Intelligence Council, multilateralism has often been perceived as a major constraint on the US.
The right to start wars
The biggest constraint has always been on the right of states to start wars.
Indeed, under the international law created by the adoption and ratification of the UN Charter in 1945, a state is entitled to go to war under only two circumstances: if it is either endorsed by the UN Security Council (UNSC) or if it is an act of self-defence.
This is why the US invasion of Afghanistan after the Sept 11, 2001, attacks was legal: it was endorsed by the UNSC and an act of self-defence. Operation Enduring Freedom, the American-led war on terror, was launched a month later (Oct 7) to stop the Taleban from providing a safe haven to the Al-Qaeda network responsible for the deadly attacks on the US.
By contrast, the invasion of Iraq in March 2003 wasn’t legal since it wasn’t endorsed by the UNSC or an act of self-defence.
ST ILLUSTRATION: MIEL
Indeed, in the build-up to the war, I experienced one of the more dramatic moments in my life.
Just before the invasion, I had organised a brainstorming lunch in my New York apartment on the merits of the invasion. Most of the participants were sober, highly educated and upper class American intellectuals. They normally stay calm. Yet, they reacted with apoplectic anger when Professor Franck asked: “What’s the difference between the coming invasion of Iraq and Hitler’s invasion of Czechoslovakia in 1939?” For a moment, I thought he was going to be lynched.
Yet, Prof Franck was only making an obvious point from the fundamental assumptions of the rule of law. Law doesn’t discriminate between rich and poor, the mighty and the weak. A rule that applies to a small state applies equally to great powers.
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Hence, when a great power invades Iraq, it certainly violates international law. This is why small states welcome multilateralism. This is also why the whole world should welcome the commitment of the Biden Administration to strengthen the rules-based order. A rules-based order is better than an order where there’s one rule for great powers and another for small states.
However, to succeed in its quest to strengthen the rules-based order, the Biden Administration will need partners. The best partners would be the two beacons of multilateralism we have in our world today: the European Union (EU) and Asean.
Why the EU and Asean?
Few in the world are aware that these two organisations are the most successful regional multilateral organisations, performing much better than other regional organisation such as the Organisation of American States (OAS), the Gulf Cooperation Council (GCC) or the South Asian Association of Regional Cooperation (SAARC).
Let me add, as an aside, that despite Asean’s problems with Myanmar, a major challenge, Asean still outperforms all these other regional multilateral organisations, in delivering both peace and prosperity to its region.
In 2000, Japan’s GDP was eight times larger than that of Asean. Now it is only 1.5 times larger. No other regional organisation has grown as fast as Asean.
In international relations, personal relations matter as much as official relations. Hence, it helps a lot that Secretary of State Anthony Blinken is a fluent French speaker who has developed a close personal relationship with Mr Emmanuel Macron, the President of France.
Among all the global leaders today, there is almost no other leader (with the possible exception of German Chancellor Angela Merkel, who is stepping down soon), who is as eloquent or as passionate in his defence of multilateralism as Mr Macron.
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As he has said: “Multilateralism is not just an act of faith; it is an operational necessity. No country can overcome this challenge alone. International cooperation may be difficult, but it is objectively essential.”
He has also said: “Multilateralism is the rule of law. It is exchange between peoples, the equality between us all. It is what allows us to build peace and address each of the challenges we face.”
Asean has demonstrated its commitment to multilateralism through its deeds. Indeed, virtually all the larger multilateral organisations or processes active in the larger East Asian region have either been created or supported by Asean.
One can make a veritable alphabet soup just by listing the acronyms of the many regional multilateral processes spawned, directly or indirectly, by Asean; including, for example, the Asean Regional Forum (ARF) (where Secretary Blinken spoke at recently); the Asia-Europe Meeting (Asem); the Asia-Pacific Economic Cooperation (Apec) forum; and the Regional Comprehensive Economic Partnership (RCEP), just to name a few.
Given the extraordinary track record of the EU and Asean in championing multilateralism in words and deeds, the Biden Administration could find no better partners to work with in trying to support the strengthening of the 1945 rules-based order.
Not much time
The world is now rocked by two major challenges: the Covid-19 pandemic and climate change. Only global multilateral cooperation can deal with them. Hence, by dealing with these multilaterally, we will strengthen global multilateral impulses.
However, if this is to happen, both the EU and Asean must act soon.
MORE ON THIS TOPIC
US needs to up its game in South-east Asia
Asean needs to stay neutral and united amid US-China tensions: Tommy Koh
The year 2024 may seem distant but in the US presidential election cycle it could be just around the corner. Many knowledgeable observers of the American political scene, including Martin Wolf and Edward Luce of the Financial Times, are warning that Donald Trump remains a political force in the American scene.
It’s not inconceivable for Mr Trump to win the next presidential election in 2024. Then the window of the US supporting multilateralism (even in an ambivalent fashion) would be slammed shut again.
Hence, while the window is still open, both the EU and Asean should seize the moment and try to strengthen as many global multilateral institutions – such as the World Health Organisation and the World Trade Organisation – as possible while President Biden and Mr Blinken are around. Time is of the essence. Let’s get cracking.
Kishore Mahbubani, a veteran diplomat, is a distinguished fellow at the Asia Research Institute at the National University of Singapore, and the author of Has The West Lost It? And Has China Won
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Trade conflict is a war without using weapons but could be equally bloody killing silently, indirectly.
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When beggar thy neighbour doesn’t work
Openness in trade is an imperative, not a favour granted. The sooner some big countries get this, the better.
Ravi Velloor
Associate Editor
Foreign direct investments into India topped US$81 billion in the 2020-2021 fiscal year.PHOTO: REUTERS
PUBLISHED3 HOURS AGO on 12th August 2021 in Straits Times.
Last weekend, Global Times, a mouthpiece for Beijing, took note of the pressure that America’s industry leaders and trade bodies have been placing on the Biden administration to withdraw the punitive tariffs on Chinese imports imposed by the previous US administration.
In an editorial headlined “Biden suffers more than Beijing from high tariffs”, it pointed to reports from the United States last week where nearly three dozen of the US’ most influential business groups, representing retailers, chipmakers, farmers and others, asked the Biden administration to restart trade talks with China and cut tariffs on imports because the tariffs were a drag on the US economy.
The trade groups included some of the most influential big business associations, including the US Chamber of Commerce, the Business Roundtable, the National Retail Federation, the American Farm Bureau Federation and the Semiconductor Industry Association. They raised the appeal in a letter to US Trade Representative Katherine Tai and Treasury Secretary Janet Yellen. The Wall Street Journal described it as the clearest collective voice of the US business community seeking to restore normal trade ties since the Biden administration took office.
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Dr Yellen herself has said that she thinks tariffs are economically harmful, although other administration officials say those views are private and not meant to signal change in US trade policy.
“US high-tariff policy is against the trend of the times and will not hold for long,” the Global Times editorial concluded. “Chinese companies have generally adapted to the new situation, while the US is suffering more from the tariffs than China.”
Its advice to Beijing is that “facts have shown that China has the strength to play the game with the US in terms of trade policies, and it is right not to make concessions when playing tough is needed”.
Global Times probably has diagnosed the situation correctly. Perhaps, Beijing itself can do a lot by heeding that wisdom. So, too, China’s giant neighbour across the Himalayas – India.
A pointed pineapple lesson
Let’s start with Beijing, and a rather prickly issue – pineapples.
In March, China, which accounted for 90 per cent of Taiwanese pineapple exports last year, inexplicably slapped a ban on pineapples imported from Taiwan. Naturally, this alarmed Taiwanese growers of the fruit, many of whom are clustered in central and southern Taiwan.
According to Asiafruit Magazine, the Chinese move caused Taiwanese pineapples to “pivot” from China. Japan stepped in as a major buyer. It has now become the top destination for Taiwanese pineapples, accounting for 70 per cent of exports, up from 5 per cent last year. Meanwhile, Hong Kong has also taken more pineapples from Taiwan, accounting for 23 per cent of exports this year, up from 2 per cent last year.
The Taiwanese industry also saw demand surge domestically as consumers rallied around a social media campaign to “save the farmers”. Restaurants added pineapple-infused items to their menus, and even the Taiwan Railways Administration introduced special lunch boxes featuring pineapples.
Did withdrawing market access to Taiwanese pineapples enhance Beijing’s clout with Taipei? Surely, no. All it did was to deny Chinese access to a much-loved fruit from across the waterway and build more resilience in its target territory. What’s more, Japan’s importance to Taiwan, which Beijing considers a breakaway province, has inched up a notch. And vice versa. Japan’s Deputy Prime Minister Taro Aso recently said his country would regard a Chinese invasion of Taiwan as an existential threat to its own security, making it likely that it would join the US in defending Taiwan.
Ditto with Australia. In May last year, angry over Canberra’s call for an independent inquiry into the origins of the Covid-19 virus that was first identified in Wuhan, Beijing hit a variety of Australian commodity exports, including barley, with an 80 per cent tariff. Naturally, Chinese importers quickly veered away from buying Australian barley, and turned to markets in Argentina, Canada, France and Ukraine.
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The end result was as follows: Barley prices, even for the Chinese, shot up. Soon, Chinese importers were even apparently accepting feed-grade barley for use as malt-grade barley.
What’s more, Australian barley exporters, after the initial shock, soon found new markets. Saudi Arabia, which ranks with China as the world’s top two importers of the grain, picked up much of the shipments that would otherwise have gone to China, to feed its livestock.
One lesson Australia did learn, however, was the overarching importance of reducing excessive dependence on a single market, in this case China. Wine exporters, similarly hit, are finding that with a little effort there are other big markets ready to accept their produce with a little persuasion.
As for France, which gained more access for its barley into the China market thanks to the hit on Australia, this didn’t stop Paris from sailing a helicopter carrier and a nuclear attack submarine into the South China Sea recently, following on the earlier visit of the carrier Charles de Gaulle to South-east Asian waters.
The lesson here is that old alliances are unlikely to be bent – only strengthened – by such short-termish actions like an abrupt squeeze on a particular nation’s exports to signal displeasure.
Just how old some of those links are came sharply into focus for me the other day when I was watching a documentary on the World War I flying ace Manfred Von Richthofen of Germany, said to be responsible for more than 80 air “kills”. It came as a surprise to note that the Red Baron, as he was known across the continent, possibly met his end thanks to anti-aircraft fire from an Australian brigade in France.
The Terminal High Altitude Area Defence anti-missile system that the US installed in South Korea, triggering an uproar from Beijing which countered with trade and tourism sanctions that may have cost the South Koreans as much as US$8 billion (S$10.9 billion) in lost earnings, not only remains in place but is also apparently being upgraded.
If Beijing wants to loosen Canberra’s more-than-century-old links with Western powers or Seoul’s strong strategic links to Washington, it may need more creative ways than a blunt instrument like trade sanctions.
ST ILLUSTRATION: MIEL
Sino-India trade
Likewise, with India. Just as US trade with China only continued to rise after the Trump-imposed tariffs, the Sino-Indian trade relationship is a similar story.
In November 2019, at the East Asia Summit hosted by Thailand, India stunned one and all by announcing it was withdrawing from talks to clinch the Asean-inspired Regional and Comprehensive Economic Partnership (RCEP), the largest trade deal in the world that currently groups Asean with five dialogue partners.
While domestic factors certainly played a part, and India felt its pleas for better access for its services exports – an area in which it has strengths – weren’t adequately addressed even as its counterparts wanted the Indian market opened for trade in goods, an equal consideration was unwillingness to expose its industry to Chinese exports.
Last year, such sentiments gained more traction after the testy ties between the two civilisational nations worsened into clashes in the high Himalayas, with casualties on both sides. This, combined with the ravages of the pandemic, saw bilateral trade take a short, sharp hit as India hoisted a raft of non-tariff measures in retaliation.
Yet, first-half figures for this year show a stunning 63 per cent increase in two-way Sino-Indian trade – the largest increase among China’s trade partners, Asean included. Bilateral trade touched US$57.5 billion, the highest on record for the first six months, according to official Chinese data.
A lot of the 60 per cent increase in Chinese exports to India is attributed to record purchases of medical supplies by India. But Indian exports to China rose even more – nearly 70 per cent – on the back of commodities shipped to the mainland, chiefly iron ore and cotton.
This surge is taking place amid a parallel development. Even as a new virus wave in China and South-east Asia causes fresh shutdowns, there’s been a balancing out of the negative perceptions India suffered earlier this year, when the pandemic looked out of New Delhi’s control. But now, supply chain vulnerabilities are showing up in Thailand and, even more importantly, Vietnam, which until recently was held up as a model story in tackling Covid-19.
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One Indian manufacturing sector that’s most visibly gaining from these developments is the active pharmaceutical ingredients (API) industry, which has taken off in a stunning manner. Shares of Laurus Labs, an API maker, have soared 230 per cent in the past 12 months. Last Friday, India’s Glenmark became the latest company to hive off its API division and begin trading on the market as a separate company.
A report circulated by Nomura Asia on Monday said its Business Resumption Index for India rose to a record 99.4 for the week ending Aug 8. Combined with a daily vaccination rate of nearly five million doses a day, Nomura said, surrounding data suggested a swifter than expected recovery from the second-wave slump.
Foreign direct investments into India topped US$81 billion in the 2020-2021 fiscal year. The fruits of the Modi government’s decision to push through a nationwide goods and services tax four years ago, turning India into a single market, are beginning to show after several loopholes were fixed.
“Pharmaceuticals and automobiles have shown India can be globally competitive in manufacturing and you will see the story being repeated in electronics and other sectors,” Mr Sanjeev Sanyal, the Indian government’s Principal Economic Adviser, told me last week.
“Previously, India did not have scale because of inherent policy bias against really big scale. For the first time, the country is actually encouraging people to think big and it does not matter if these are foreign or locally owned firms, as long as the activity takes place in India.”
With this kind of economic muscle building, New Delhi now needs to ask itself whether it serves its own interests to continue turning its back on RCEP and China, or do the sensible thing and begin an active engagement with the wider Asian region. The lesson from Asean is that back in the day when the group signed its free trade deal with China, there was similar diffidence. Many feared that their markets would be overrun by Chinese goods. Today, such worries are barely heard.
In my monthly podcast to be published on The Straits Times website tomorrow, which touches on Sino-Indian ties, I asked Professor Kanti Bajpai, Wilmar Chair of Asian Studies at the Lee Kuan Yew School of Public Policy, if he thought the Indian decision on RCEP was a permanent one. He seemed to suggest that at some point, New Delhi might yet second-guess it.
The sooner it does so, the better, above all for itself. If there’s one thing these past decades of trade openings have taught us, it is this, regardless of the nation involved: Beggar thy neighbour isn’t policy, just peevishness.
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Cooperation…but where is the money, all about money…
Where does the big money go to?
Talk only will not bring cooperation. It is to put your money on the table.
Keeping the vaccine formulae a state secret is not true cooperation.
When countries of APEC denounce this as a crime against humanity, we can see light at the tunnel coming for mankind’s cooperation in love and harmony.
The insincerity and deception have to stop.
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The Straits Times’ Editorial says
Apec underlines continued cooperation
PUBLISHED3 HOURS AGO on 20th July 2021 ST
It speaks to both the urgency of the situation, and New Zealand’s credibility as an exemplar in the fight against Covid-19, that when it announced it would convene a first-ever extraordinary Apec meeting to shape a regional response on how to recover from the pandemic, there was a swift and positive response from Asia-Pacific leaders, including presidents Xi Jinping of China and Joe Biden of the United States. In the event, last week’s virtual informal summit agreed that Asia- Pacific Economic Cooperation members would ensure widespread access for vaccines globally, continue to pump up economies for as long as necessary, protect and promote supply chain resilience, and ensure no one will be left behind.
While some of the aims resemble boilerplate statements that flow regularly from meetings such as these, they take on critical meaning in the current context. Keeping trade flowing and kick-starting travel are critical to the economic recovery of the region. The gross domestic product of Apec economies shrank 1.9 per cent last year, the largest decline in nearly 80 years. Millions of jobs were lost, or vanished, as people adapted to new ways of work and living. Inequality, already a major worry, significantly worsened, and so did the digital divide. In many parts of the world, vaccine nationalism combined with nativism, and even racist instincts in some cases, to produce scars in the international fabric and domestic society.
These weals need swift healing and only a joint effort can pull it off. For a start, nations that are ahead in the vaccination programme should make excess vaccines available to others, as Singapore is poised to do through the Covax initiative. What is more, as Prime Minister Lee Hsien Loong told his fellow Apec participants, it is imperative to prepare and cooperate to prevent the next pandemic that will surely come, and perhaps with greater virulence. As the G-20 High Level Independent Panel also highlighted recently, security from pandemics depends on bolstering multilateralism, including a scaled-up global surveillance system to keep a weather eye out for emerging infectious disease outbreaks.
Every crisis also presents an opportunity. Even as nations bolster self-reliance, perhaps understandable in the current context, they must be careful to not go so far as to raise barriers. While travel restrictions and some curbs on the movement of goods are inevitable, the pandemic has accelerated the switch to a digital economy. As these trends are still in their nascent stage when compared with potential, there is a massive window available to align rules, standards and inter-operability in the digital realm. This could be for something as basic as checking the vaccination status of travellers, and stretching to far more complex arrangements, including fundamental research. This is a moment not to be missed.
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Four is good.
Playing with word/s.
What is in four for it to be good. Look at the four points in the Cross. Look at the Core in the Cross.
Do humans see beyond numbers and words?
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Ceca is not a four-letter word
Amid Singapore’s increasingly complex challenges, the last thing it needs is the non-constructive circularity in the trade pact’s debate.
Grace Ho
Senior Political Correspondent
Singapore has long tapped foreign manpower to overcome the limitations of its human capital.ST PHOTO: KUA CHEE SIONG
PUBLISHED3 HOURS AGO on 18th July 2021 in Sunday Times
Depending on who you speak to, Ceca is either a passport to a larger market, a derogatory term for Indian nationals in Singapore, or shorthand for the supposed ills of Singapore’s foreign manpower policy.
Despite multiple assurances from the Government that the India-Singapore Comprehensive Economic Cooperation Agreement (Ceca) does not give Indian job seekers a free pass here, some have latched on to a few areas of the trade pact: intra-corporate transferees, a list of 127 professions in the annex to Chapter 9 on movement of natural persons, and the ability of accompanying spouses or dependants to work here.
The issue was roundly debated in Parliament. I thought that Health Minister Ong Ye Kung – a former trade negotiator – and Manpower Minister Tan See Leng supplied useful facts and gave an accurate steer on how Ceca works.
As Dr Tan said, free trade agreements (FTAs) are a red herring. But the issue goes beyond FTAs to how they intersect with the policies of the day.
Overcoming limitations
Singapore has long tapped foreign manpower to overcome the limitations of its human capital.
In the 1980s, programmes to draw skilled labour here included the Professionals Information and Placement Service, and the Committee on Attracting Talents to Singapore.
Later, an international manpower division was created within the Manpower Ministry (MOM) to oversee Contact Singapore offices in global cities and draw overseas talent to work here.
The efforts paid off. A 2016 study by two Institute of Policy Studies researchers said net migration numbers “increased drastically” in 2005 and peaked in 2008.
The increase in percentage of the non-resident population grew from 2004 and peaked in 2008, it added, noting that this helped counter falling birth rates here.
Rear-view mirror
Should foreign manpower policy in the 2000s have been tighter?
Citing the Fair Consideration Framework introduced in 2014, Progress Singapore Party (PSP) Non-Constituency MP Leong Mun Wai questioned if such measures were “too little and too late”.
It is difficult to tell.
In a world where industry and labour needs change rapidly, policymakers find themselves shooting moving targets.
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Mr Ong had this to say: “You can’t say because we implement something new now to respond to the situation, therefore, we have failed…
“Then every Bill that’s tabled in this House is: ‘You have failed, you should have tabled this Bill five years ago’. It doesn’t make sense.”
Will it help to make more data available, instead of leaving the public to draw its own, sometimes wrong, conclusions?
Singapore Management University assistant professor of law Benjamin Joshua Ong notes that while Ceca does not oblige Singapore to grant employment passes (EPs) to Indian nationals, some people disagree with the number of EPs Singapore has chosen to grant.
“They may be confusing the decision to enter into Ceca, with decisions to grant EPs to Indian nationals,” he says, adding that Ceca then becomes the most tangible target.
He says MOM could consider dispelling myths about Ceca, by issuing statements with more details about how it makes decisions on the granting of EPs and other types of work passes.
Nanyang Technological University assistant professor of sociology Laavanya Kathiravelu suggests breaking down employment data by the percentage of foreigners in different industries, which would make clear what kinds of gaps they are filling in the economy.
“This could also identify training and education that locals and local institutions could focus on, to better address these gaps,” she says.
In Parliament, Minister Ong acknowledged Leader of the Opposition Pritam Singh’s comment that misunderstandings could have been nipped in the bud if more information was released earlier. But he also explained that the state is not always at liberty to disclose certain data which is classified.
Racism and Ceca
Where one draws a thick, red line is the use of Ceca to stoke racist and nativist sentiments.
Before Covid-19, Indian nationals were already highly visible here due to their concentration in certain residential developments and sectors such as information technology and banking.
Vitriol against them grew as the Delta variant hit Singapore’s shores, even escalating to physical attacks.
Minister Ong cited four occasions between 2019 and this year when the PSP levelled false accusations about Ceca.
Before that, Law and Home Affairs Minister K. Shanmugam had said that some parties deliberately stoked fears by engaging in “dog whistling”, or the use of coded language that seems innocent to a general audience, to communicate something more insidious to a particular group.
“First, it’ll be expat Indians. Then, it will come to Singaporean Indians,” said Mr Shanmugam, cautioning that eventually all Indians can be a target of hate.
Prof Kathiravelu says Singaporeans may be feeling vulnerable or even threatened, amid uncertainties brought on by the pandemic, adding: “This stems from notions of competition, and the idea that there is a finite set of resources such as jobs.”
No amount of data can prevent some from viewing Ceca as inherently suspect. Knowing this, and also knowing how racially charged the public discourse on Ceca is, PSP’s refusal to walk back on its past statements is troubling.
It sets up a dangerous dynamic for Singapore, which relies on trade to expand its economic space and enhance its labour market flexibility. Already, some foreign investors and residents feel Singapore is anti-foreigner.
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Bridging gaps
But there is certainly room to boost skills, tackle workplace discrimination and improve the take-up rate of FTAs by businesses.
Singapore’s ageing workforce and how foreign manpower helps fill essential jobs that are not attractive to locals were earlier broached by Singapore Business Federation chief executive Lam Yi Young.
He said that at the other end of the spectrum, they also bridge critical skills gaps in high-skill areas such as digital technology, advanced manufacturing and cutting-edge research.
Various People’s Action Party and Workers’ Party MPs have called for anti-discrimination laws.
Labour MP Patrick Tay wants to make public the companies on MOM’s “triple weak” watchlist – those which hire a high proportion of foreigners, have no plans to recruit more Singaporeans and contribute little to the economy.
Dr Tan gave the assurance that a review is under way, but stressed that Singapore should not be seen as overly prescriptive and end up pushing businesses overseas.
In the end, the best advocates for FTAs are the businesses themselves.
But many of them, especially smaller ones, still do not tap FTAs despite officials’ extensive outreach and education efforts.
This suggests two things, says managing partner of PwC Worldtrade Management Services Frank Debets: Either they cannot meet compliance rules, or the effort required outweighs the real or perceived benefits.
If the Government wants to push harder, it could divert some of the outreach resources to making digital tools more accessible, or even a mandatory part of a company’s export declarations.
This is because while there are many technology solutions available, they are often narrow, expensive and do not come with the necessary assurances, he explains.
“A government-backed and reliable technology tool that can enable, document and certify FTA compliance would solve this problem. It would also address one of the biggest worries that companies have – mitigating the risk of inadvertent non-compliance.”
MORE ON THIS TOPIC
Misrepresentations of Ceca have caused unnecessary public concern: PM Lee
Chapter on movement of persons wasn’t used as bargaining chip to sign Ceca pact: DPM Heng
The bottom line is this: Ceca does not interfere with the authorities’ powers to decide whether foreigners can enter and live here. But highly skilled professionals ought to have the assurance that once they are allowed to work in another country, there should be no additional, unjustified red tape.
And when there is an economic slump, it is foreigners who cushion the blow of job losses that would otherwise fall on Singaporeans alone.
Back in 2005 when the ink on Ceca was barely dry, no one could have predicted just how far and wide it would reverberate in the public’s consciousness.
But the last thing Singapore needs now, as it confronts an increasingly complex set of challenges, is the kind of non-constructive circularity that the Ceca debate has been mired in.
It is time to stop looking back, and instead gear up Singapore for what lies ahead in the post-Covid-19 world.
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Do more to tackle racism in the workplace
Yuen Sin
Political Correspondent
The workplace can be one area in which more targeted action can be taken.ST PHOTO: MARK CHEONG
PUBLISHED3 HOURS AGO on 18th July 2021 in Sunday Times
Stories of how minorities in Singapore have to grapple with discrimination in their daily life have been shared more widely recently, following a recent rash of racially charged incidents that have opened up a national conversation on race.
On social media platforms, such as @minorityvoices on Instagram, anecdotes of casually racist or discriminatory incidents that have occurred in the workplace are rife – someone recalls hearing their colleague use racial slurs after speaking to Indian customers, while others spoke of how minorities faced prejudice when looking for jobs.
Finance Minister Lawrence Wong took a strong stance against such behaviour in a speech last month, when he noted that “these things do happen, not always, and perhaps not even often, but sometimes”.
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“And when they do happen, they cause real hurt, which is not erased by lightly dismissing them as casual remarks or jokes.”
He said that minorities here – just as in any other country – may face more difficulties than other races, and called on members of the Chinese majority here to do more to make their minority friends, neighbours and co-workers feel comfortable.
Worryingly, an Institute of Policy Studies-OnePeople.sg study released in 2019 also found that almost 60 per cent of Malays and 56 per cent of Indians perceived discriminatory treatment at work. This was a slight increase from the 58.7 per cent of Malays and 52.6 per cent of Indians five years ago.
Mr Wong’s remarks are a timely reminder for many of us Singaporeans, who may have been blind or oblivious to the hurt that our remarks and actions – unconscious or otherwise – may have had on others.
At the same time, it could take time for real change to be achieved on the ground, given that people may lack the resources or training to understand what actions and behaviour can hurt others.
The workplace can be one area in which more targeted action can be taken, given that most adult Singaporeans spend a substantial amount of time at work. Targeting adults also helps them serve as better role models for their children.
More training and education on how to correct and address racist or biased behaviour can make a huge difference in reducing the amount of such incidents that we hear about online, or from our friends.
Current gaps
Currently, the Tripartite Alliance for Fair and Progressive Employment Practices (Tafep) has guidelines in place to address discriminatory behaviour in the workplace, including racial discrimination.
They spell out how discrimination should be avoided when it comes to job advertisements, hiring and assessing the performance of employees, among other things.
Employers who flout the guidelines could face administrative penalties, such as having their work pass privileges curtailed, said Institute for Human Resource Professionals chief executive Mayank Parekh.
Cases of offensive remarks at work can also be reported to Tafep. “But casually racist remarks are often hard to prove and go unreported,” said Mr Ian Lim, head of employment and labour at TSMP Law Corporation.
There is currently also no mandatory requirement for companies to have a policy on diversity and inclusion, said Mr Lim. Such policies ensure that all workers from diverse backgrounds are treated fairly, and feel involved, valued and respected at work.
Diversity and inclusion training is also not widespread among most Singapore employers, said Mr Parekh.
MORE ON THIS TOPIC
S’poreans can make the first move to help strengthen race relations: ST webinar panellists
More needs to be done to combat racial microaggressions in S’pore: ST webinar panellists
What else can be done
Introducing more legislation and regulations may not be the best solution, as they may not address the root causes of racism in the workplace, said Mr Lim and Mr Parekh.
Instead, education and training efforts can be stepped up, especially since such programmes to address racism or unconscious bias, when workers collaborate with or evaluate their colleagues in the office, are not widely adopted.
Many training resources are already publicly available to kick-start such efforts. For instance, the website okayornot.sg, started by volunteers from the not-for-profit collective Better.sg, provides an interactive platform for Singaporeans to have respectful conversations about race.
Users of the website are shown statements or examples of actions in everyday life, and are told to decide whether these actions or statements are “okay” or “not okay” to say or do in daily life.
Some examples of these statements include: “You’re not like most Indians I meet” or “I try to avoid eating with my Malay colleagues because it’s difficult to find halal food”.
There are no right or wrong answers, though respondents will be shown the answers given by other respondents, which offers up a useful starting point for them to reflect on how some actions that they perceive as acceptable could be hurtful to others. More safe spaces to discuss such instances of casual discrimination at work can also be carved out, to allow employees to speak honestly and candidly about their experiences.
As part of the OneWorkplace.sg initiative led by the National Integration Working Group for Workplaces, funding support is available for companies that wish to organise bonding or volunteering programmes to build trust between local and non-local staff.
Perhaps such funding support can also be extended to firms that wish to introduce diversity and inclusion programmes in their workplaces, with a focus on addressing racial biases – whether or not they involve local or foreign staff.
There should also be a framework or criteria to evaluate the success of such efforts. For instance, annual company-wide surveys can be conducted by an appointed third party.
Mr Alvin Goh, executive director of the Singapore Human Resources Institute, suggested that more firms adopt an “anti-discrimination” indicator, where employers can track their progress in combating prejudice in the workplace.
MORE ON THIS TOPIC
Race classifications, data and self-help groups still relevant: ST webinar panellists
Call out racism in constructive manner to further discussions, say ST webinar panellists
More firms should also adopt a transparent and comprehensive policy on addressing and combating racism in the workplace. This involves spelling out what discriminatory or racist behaviour could look like in employee handbooks, and developing a system for follow-up action that can be taken should any employee experience or witness such behaviour.
This could include counselling or coaching perpetrators, as well as penalties in severe cases.
Resources for specific industries could also be helpful.
For instance, in the healthcare industry, toolkits could be developed to draw attention to bias when handling patients.
In other countries, there have been reports of how doctors and nurses may be dismissive of symptoms when a patient of a particular race highlights them, and perceive this as an exaggeration on their part rather than a condition that genuinely requires attention.
In the property sector, property agents should also advise their clients against stating their racial preferences – or better yet, from having racial preferences – when renting out their units.
We need to harness the energy from the conversations on race that are ongoing right now and direct it towards such educational efforts. If adopted on a large scale, they can bring about meaningful change, and ensure that workers are spared hurtful comments or actions.
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It would have been political suicide for any political party let alone the PAP to allow in the FTAs or CECA for Singapore to give free pass to any foreign nationals to enter and work in Singapore.
Who in the right mind will allow that?
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Does Ceca give Indian nationals a free pass into Singapore?
5 myths and facts about the trade pact
Health Minister Ong Ye Kung and Manpower Minister Tan See Leng debunked misconceptions about the Ceca free trade pact in Parliament on July 6, 2021.PHOTO: LIANHE ZAOBAO
Grace Ho
Senior Political Correspondent
PUBLISHEDJUL 6, 2021, 4:25 PM SGT in Straits Times
SINGAPORE – In a ministerial statement on Tuesday (July 6), Health Minister Ong Ye Kung – formerly the deputy chief negotiator for the US-Singapore FTA – and Manpower Minister Tan See Leng debunked misconceptions about the Singapore-India Comprehensive Economic Cooperation Agreement (Ceca).
The free trade pact, which was inked in 2005, has come under attack from some quarters on social media, as well as during last year’s general election.
Here are five myths and facts about Ceca, according to the Ministry of Trade and Industry.
Myth 1: Ceca obliges Singapore to give Indian workers free entry into Singapore
Fact: Ceca does not give Indian nationals unfettered access to Singapore’s labour market.
All foreign nationals, including Indian professionals and intra-corporate transferees (ICTs), have to meet prevailing work pass criteria before they are allowed to work in Singapore.
ICTs refer to transfers of a company’s employees from one country to another. They have consistently constituted a very small number – about 4,200 in 2020, of which 500 were from India.
Some have noted that companies that bring in ICTs do not have to advertise the position to locals as part of the Fair Consideration Framework, which requires employers to advertise jobs on the MyCareersFuture.sg portal before submitting Employment Pass (EP) and S Pass applications.
But overseas ICTs must fulfil additional criteria in order to meet the definition of ICTs in Singapore’s free trade agreements (FTAs), including a minimum duration of working for the employer outside of Singapore.
They are also subject to conditions on their eligibility to bring in dependants, apply for permanent residency or future employment in Singapore.
For example, under Ceca, such transferees must have worked at least six months in the parent company, among other requirements. They can stay in Singapore for a total term of eight years, at most.
Myth 2: Ceca gives Indian nationals privileges for citizenship or permanent residency
Fact: Nothing in Ceca affects Singapore’s right to regulate immigration, citizenship or permanent residency.
Chapter 9 of the agreement on movement of natural persons makes it clear that the Government’s ability to regulate immigration and foreign manpower is not affected by the agreement.
Article 9.1.2 explicitly states that Ceca “shall not apply to measures pertaining to citizenship, permanent residence, or employment on a permanent basis”.
Debunking 5 myths about S’pore-India trade pact | THE BIG STORY
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Chapter on movement of persons wasn’t used as bargaining chip to sign Ceca pact: DPM Heng
Myth 3: Ceca obliges Singapore to allow the entry of Indian dependants and for them to work in Singapore
Fact: All work pass holders need to meet the Manpower Ministry’s prevailing criteria to bring in dependants.
The vast majority of dependants are in Singapore to accompany the work pass holder and do not work during their stay in Singapore. Those who wish to work have to apply for a relevant work pass.
Since May 1 this year, foreigners staying in Singapore on dependant’s passes have needed a work pass to work here, instead of a letter of consent.
This means their employers need to apply for an EP, S Pass or work permit for them, and the relevant qualifying salary, dependency ratio ceiling and levy apply.
MORE ON THIS TOPIC
Ceca does not allow unconditional entry of Indian professionals into S’pore: Ong Ye Kung
FTAs and Ceca made ‘political scapegoats’, falsehoods need to be corrected: Ong Ye Kung
Myth 4: There is a separate category of ‘professional visas’ for the 127 professions listed in Annex 9A of Ceca
Fact: There is no such separate category. They are subject to the same prevailing work pass criteria that the Manpower Ministry applies to all other foreigners.
A similar listing of professions is contained in India’s FTAs with a few other countries.
India’s Comprehensive Economic Partnership Agreement with South Korea has 163 professions in its annex to the chapter on movement of natural persons.
Its agreement with Japan also contains an appendix with professions in areas ranging from computer services to management consulting.
There is even a separate provision for the temporary stay of Indians in Japan who teach Indian yoga, cuisine, classical music and dance.
MORE ON THIS TOPIC
Indian EP holders nearly doubled to 25%, driven by digital economy growth
4,200 intra-corporate transferees in S’pore last year, number remains consistently small
Myth 5 : The nationality profile of Singapore’s foreign workforce has been influenced by Ceca
Fact: The nationality composition of Singapore’s workforce is an outcome of the sectors it has chosen to focus on, as well as the global demand and supply of workers with the relevant skill sets.
These workers are competitive in certain sectors, and from certain countries of origin.
As Singapore does not have enough locals to fill these jobs, Indian tech professionals have come to Singapore through the work pass framework to complement local tech talent.
The growth of the digital economy, in turn, creates good jobs for Singaporeans.
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Politicians who are well versed and are knowledgeable of the intricacies of tariffs, FTAs, and the economic SWOTs of their country at micro and macro levels will stand in good stead and be far ahead of others in this modern and fast inter-related multilateral world of commerce and inter-connectedness.
Hope many are in the lop league in understanding that the Origin of the world is One, a world without borders except those created by man.
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In full: Ong Ye Kung addresses ‘false’ statements on FTAs, Singapore-India CECA in Parliament
Health Minister Ong Ye Kung speaking in Parliament on Jul 6, 2021.
(Updated: ) in channelnewsasia.com
SINGAPORE: Health Minister Ong Ye Kung spoke in Parliament on Tuesday (Jul 6) to address “false” statements surrounding free trade agreements (FTA) and the Singapore-India Comprehensive Economic Cooperation Agreement (CECA).
He was speaking on behalf of the Ministry of Manpower (MOM) and the Ministry of Trade and Industry (MTI) to “put into context” the parliamentary questions that have been posed to the ministries concerning foreign professionals, managers, executives and technicians (PMET), FTAs and CECA.
The speech is reproduced here in full:
I am delivering this ministerial statement for two purposes.
First, even before the General Election last July, the PSP (Progress Singapore Party) has repeatedly alleged that the Comprehensive Economic Cooperation Agreement (CECA) between Singapore and India allows professionals from India “a free hand” to come and work in Singapore.
In his social media post on Jun 22 this year, Mr Leong Mun Wai again said that “the most important economic policies that have affected the jobs and livelihoods of Singaporeans relate to foreign PMEs and free trade agreements, in particular CECA”.
Mr Speaker, these statements are false. They have been repeated for too long. I am a former trade negotiator at MTI when I was a civil servant. We worked closely on several FTAs. I worked with a very dedicated team, who has over two decades fought hard for the interest of Singapore, to expand our economic and political space for our small island state. I feel I owe a duty to correct the falsehoods.
Indeed, Singaporean PMEs, like PMEs in other advanced economies, are facing challenges. Many have given us their feedback, and the Government has been taking steps to address their concerns. But our FTAs in general and CECA in particular are not the causes of the challenges our PMEs face; if anything, they are part of the solution.
FTAs and CECA have been made political scapegoats to discredit the policy of the PAP Government.
The second reason to deliver this ministerial statement is to put into context, on behalf of MOM and MTI, the parliamentary questions that have been posed to the ministries concerning foreign PMETs, FTAs and CECA. Dr Tan See Leng will further elaborate on the answers.
Taken together, Dr Tan and I will address Oral Questions 1 to 3 and Written Questions 19 to 24 from yesterday’s Order Paper, and Oral Answers 1 to 6 and Written Questions 40 to 42 from today’s Order Paper – a total of 18 questions.
Several of the questions were filed by PSP’s two NCMPs, to gather data for a subsequent debate on a Motion they intend to file. So where we can, we will provide relevant data to equip all parties for that subsequent debate.
HOW WE GOT HERE
So let me first recapitulate how we got here.
First, as I mentioned, for months now, the PSP has alleged that FTAs and CECA have led to the unfettered flow of Indian professionals, displacing Singaporeans from their jobs and bringing about all kinds of social ills.
And this is a seductively simplistic argument that workers facing challenges at their workplaces can identify with and has stirred up a lot of emotions. CECA-themed websites have sprouted, filled with quite disturbing xenophobic views about Indian immigrants.
Words gradually became deeds, toxic views turned into verbal and physical assaults on Indians, including our citizens. It is sad that serious issues concerning the economic well-being of our country and workers have descended to this.
That is why the Minister for Law called out such xenophobic behaviour during the May sitting of this House and challenged the PSP to table a Motion on CECA so that the matter could receive a proper public airing.
The PSP has since made a public statement on the matter, standing by its view on FTA and CECA. It filed various parliamentary questions requesting for more data and information.
So today, I will talk about the following: One, what is fundamental to Singapore’s ability to earn a living and survive; two, why FTAs, including CECA, advance our interest, and are not the cause of the challenges faced by our workers; and three, what then are the causes of Singaporeans’ concerns and how do we address them?
Dr Tan will provide detailed answers to the specific questions, including providing the data which will be useful for our subsequent debate and putting that data in context.
SINGAPORE NEEDS TO EMBRACE GLOBALISATION
Let me start with the first question – what is fundamental to our economic survival. Simply put, we are too small to survive on our own, and we need to tap into global markets to earn a living and be self-reliant.
What do we have to start with? We have no natural resources, but we have one precious natural endowment and that is our geographical location.
It is a lasting advantage, but one which requires us to work very hard to realise and to sustain. And if we succeed, it helps compensate for our lack of size.
And that is what we have done. By capturing the trade flows through the Straits of Malacca and Singapore, PSA became the largest container trans-shipment port in the world. It is a unique interchange in the world, connecting East and West, Europe, Middle East, India, China. The port is central to the growth of the maritime industry, responsible for 160,000 jobs in Singapore today.
In addition to our seaport, we have also grown into an aviation node. Before COVID-19 hit us, Changi was one of the busiest airports in the world – and it shall be so again – though in aviation terms our geographical location is not quite ideal. We made it happen, with a renowned Changi and SIA experience. Before COVID-19 struck, the aviation-related industry were supporting 190,000 jobs.
So with these good global connections, we built up the manufacturing sector, about one-fifth of our GDP today. We obviously don’t manufacture just for Singapore, but we manufacture for the world. And manufacturing supports another 440,000 jobs today.
Our exports also include trade in services. One growing services sector is financial services. And today, almost every major global financial services institution is in Singapore, carrying out a range of activities including new ones such as FinTech and Green Finance. The financial services sector employs over 170,000 people.
We are also becoming a centre for technology, research and development. So many global technology firms – from FAANG to BAT and many more – are in Singapore. And they make Singapore their regional or global innovation centre, or engineering hub.
And today, 50,000 international companies operate out of Singapore. Seven hundred and fifty of them have made Singapore their regional headquarters.
None of these would have happened without a clear strategy, implemented well.
It was a long, painstaking process, part of the story of our island nation. Clean government, rule of law, safety (you can walk on the street any time of the day), political stability, good infrastructure, high standards of education, openness to the world – all this and more come together to make us a good place to invest and created many jobs.
I should emphasise that another big plus point for us is the quality of the Singaporean workforce. Our people are well known to be well-educated, diligent, responsible, trustworthy, and we get things done. We have one problem which is there are too few of us, Singaporeans – a point which I will come back to later.
On top of all these plus points, we have built a network of 26 FTAs including US, China, EU, Japan, ASEAN, India, South Korea, Australia and New Zealand – all our major markets and they are all our FTA partners.
And this brings me to the next topic, why FTAs, including CECA, are important to Singapore.
IT IS IN SINGAPORE’S INTEREST TO PURSUE FTAs
We started our FTA strategy in the late 1990s. We thought through it carefully and executed before other countries did. So it gave us a very precious early mover advantage, and greatly boosted our efforts to export, attract investments, venture overseas, and created good jobs for Singaporeans.
Our total trade is three times our GDP. Since 2005, our total trade has nearly doubled from around S$890 billion to S$1.5 trillion.
And today, when EDB goes out and persuades investors to come to Singapore, our network of FTAs is always a major selling point.
FTAs are especially important to our SMEs. They free them from being constrained by our small domestic market and give them access to global markets. So our SMEs are sending all kinds of Singapore-made products overseas, from canned food, barbecued pork, frozen roti prata – I heard some are exported to India – to medical devices, machines, components and chemicals.
FTAs are also spurring our companies to venture abroad. Our investments overseas increased nearly five times, from S$200 billion in 2005 to over S$930 billion in 2019. So when our companies grow overseas, they become stronger and they also employ more Singaporeans here.
If we accept this basic reality that Singapore needs the world to earn a living, then we would realise the fundamental importance of all our FTAs. They are a keystone of the economic super-structure that we have built. We could not have advanced the welfare of Singaporeans to the degree we have without FTAs.
We cannot take all these for granted. Recently, we fell in the 2021 IMD world competitiveness ranking from 1st place to the 5th place. Among the components evaluated, we continue to do well in terms of government efficiency and economic competitiveness. However, we lost ground in terms of openness towards global talent and trade.
But I hope this is temporary and due to the effects of COVID-19. Overall, we are still holding our own in terms of foreign investments. In 2020, even as 45 companies ceased operating their regional or global headquarters in Singapore, over 130 companies set up such headquarters here.
So when you attack FTAs and worse, if your attack succeeds, you are undermining the fundamentals of our existence, of the way we earn a living, of all the sectors FTAs support and the hundreds and thousands of Singaporean jobs created in these sectors.
As the attacks on FTAs, especially CECA, have been very specific, let me explain how FTA works. And to prepare for this statement, I had to dig up my old negotiating notes and do quite a bit of revision and homework. Here it goes.
The key disciplines of an FTA are as follows:
It requires a country to remove or lower tariffs on substantially all trade between the FTA partners. This is of tremendous benefit to Singapore, very good deal. Why? Because other countries customarily impose tariffs on thousands of items. We are already very open, we impose duties on only three alcohol products – beer, stout and samsu. All my years of negotiating FTA, I don’t know what samsu is, neither have I drunk it before. But these are our three tarriffed items. Hence, any FTA that substantially removes tariffs imposed by both parties is inherently beneficial to Singapore.
FTAs also require governments to accord protection to foreign investments and ensure that regulations are imposed fairly and equally on both local and foreign firms. They also set standards on protection of intellectual property.
Singapore always protects foreign investments and applies our regulations fairly. This makes us attractive to foreign investors, so it has always been our interest to do that. So abiding to these principles and disciplines is not a problem to us at all.
In fact, as more of our companies expand overseas and they create their own products, they too hope that Singapore can negotiate similar protection for them when they go overseas. So the investment and intellectual property protection disciplines in FTAs are therefore important assurances for our companies.
Newer FTAs also set certain environmental and labour standards. Not every country supports them, but Singapore believes that they reflect contemporary concerns relating to free trade and investments.
And specifically on CECA, this FTA with India benefits Singapore in many ways. Signed in 2005, it was India’s first comprehensive bilateral FTA with any country. And CECA gave Singapore a strategic first-mover advantage in India, just when the continental country was taking off to be an economic powerhouse.
CECA reduces tariff barriers, which made Singapore goods more competitive in the Indian market. And partly because of that, bilateral trade between Singapore and India has grown by over 80 per cent, from S$20 billion when CECA came into force in 2005 to S$38 billion in 2019.
And similarly, Singapore’s direct investment abroad in India grew by 50 times, from S$1.3 billion to S$61 billion during the same period. In 2019, 660 companies from Singapore have investments in India, almost double the number a decade ago.
As these companies grow regionally, they hire more people back home. And in 2019, they employed 97,000 locals.
Despite these significant benefits, FTAs are controversial in many countries. As a trade negotiator, I have listened to the problems and sensitivities of many of our FTA partners.
What are these sensitivities? Some countries wished to protect certain sectors, such as agriculture – that is a very common one – which Singapore does not do. We have some eggs, we have some fish, but more for a bit of source diversification. We never seek to conquer the world with our eggs and our seabass. Others could not live up to, say, the transparency standards of, say, government procurement or intellectual property protection. Still others are concerned about the influences of foreign culture through industries such as arts and entertainment. Canada, for example, is very sensitive about this area.
So the toughest job and the most time-consuming job of a negotiator is to identify and understand the sensitivities of your country and then find ways to protect or to address them. How do we do so? We find words that give you comfort that address the sensitivity.
And we call these words in our jargon “exceptions” or “carve-outs”. When we have a big carve-out, with strong protection in sensitive areas, we will say “this carve out is strong and big enough for a jumbo jet to fly through”.
In some sensitive areas, it is easy to negotiate exceptions or carve-outs because everyone agrees. One example is right of taxation by governments. Another one is national security. The third one is immigration.
Every country holds the view that there cannot be unfettered movement of people across borders. Every FTA partner believes that. That would create social unrest and a big public uproar. Governments must retain the ability to impose immigration and border controls, and FTAs cannot undermine that.
Hence, in all FTAs and also WTO agreements, you will find that immigration powers are strongly and prominently preserved and protected. You can find such standard clauses in the WTO Agreement as well as in all our FTAs, including CECA.
As so many falsehoods have been said about the immigration-related parts of CECA, let me set out in some detail what is really in the agreement.
Immigration matters are set out in Chapter 9 of CECA – Movement of Natural Persons. The legal text is available online, so I will only detail the salient points:
One, the chapter makes it clear the Government’s ability to regulate immigration and foreign manpower is not affected by the agreement. The Government retains full rights to decide who can enter the country to live, to work, become PRs or become citizens.
This is clearly set out in two clauses. They are standard clauses commonly found in all FTAs, and they are also the second and third paragraphs of the chapter of CECA, so it is hard to miss them, as you can see them on the first page:
Clause 9.1.2: “This chapter shall not apply to measures pertaining to citizenship, permanent residence, or employment on a permanent basis.”
Clause 9.1.3: “Nothing contained in this chapter shall prevent a party from applying measures to regulate the entry or temporary stay of natural persons of the other party in its territory, including measures necessary to protect the integrity of its territory and to ensure the orderly movement of natural persons across its borders …”
That’s the first point.
Second point, the obligations relating to Movement of Natural Persons in CECA, as in all FTAs, are not broad principles with wide applications, but actually highly specific.
What are these broad principles that you can find in FTA? One broad principle is that of National Treatment. It is found in some chapters of FTA, such as Trade in Services and Investments. This means – I mentioned this just now – you cannot discriminate against foreign service providers and investors. Whether they are local investors or foreign investors, you treat them the same. Regulations and benefits that apply to local firms must apply evenly to foreign-owned ones.
So if immigration had not been carved out, and National Treatment principle had been incorporated into Chapter 9 of CECA, then indeed, Indian workers would have to be treated like Singaporeans and would have had free rein to come to live and work in Singapore.
This is what the PSP claims. Except that there is a strong immigration carve-out and National Treatment is not found in Chapter 9 of CECA, nor any other corresponding chapter in the FTAs that Singapore has entered into.
Mr Speaker Sir, I emphasise and underline and highlight and bold, bigger fonts, colour red that nothing in this agreement implies Singapore must unconditionally let in PMEs from India. Contrary to PSP’s claim, our ability to impose requirements for immigration and work pass has never been in question in CECA or any other FTAs that we have signed.
Instead, then what are the obligations of Chapter 9 of CECA? They are highly specific, such as require the parties to process applications for temporary entry with some expedition and with certain transparency, such as informing the applicants of the outcome of their applications and not leaving them in suspense – a very reasonable thing to do and to agree to adhere to.
We also have to accord a certain duration for the validity of the permits. Should we approve, an approval must be based on them meeting our prevailing work pass conditions – also very reasonable.
Such a commitment on duration is not something unique to CECA because similar commitments exist in other FTAs and are also found in the WTO Agreement signed by 164 members including Singapore.
Many parties to FTAs also commit not to impose labour market tests. This is a common clause in our FTAs, including with India, Australia, China and the US.
It means we do not insist that companies go through onerous processes and documentation to prove that no suitable locals will take a job, before they can hire a foreigner. Companies in Singapore or any other places do not hire this way. What they do – the common and best practice – is to interview the suitable candidates, consider them all fairly and then make a judgement on the best person.
These are all market-friendly, widely adopted, reasonable obligations.
Let me also specifically address two aspects of the chapter on Movement of Natural Persons in CECA that has been singled out for criticism.
First, the PSP pointed out that CECA listed 127 categories of professionals and hence claimed that Indian nationals in these professions can all freely come here to work for a year. This is false, because as I explained earlier, all foreign PMEs have to meet our work pass conditions in order to come and work here.
What does the listing then show? The listing shows the types of Indian professionals who may apply to work in Singapore. It does not mean that we must approve their application. It’s just that you can apply. India for its own reasons requested for such a list, similar to what they have in their FTAs with Korea and Japan. In fact, even if they had not listed the professions, their PMEs could still submit work pass applications to work here. The list probably meant something to India because there may be countries that would not even let you apply. That’s how protectionist some countries may become and India is trying to secure their interest there.
This is in fact how other FTAs work: With or without listing of professions, nationals from our FTA partners are not precluded from submitting work pass applications, which will be evaluated based on our prevailing criteria and work pass conditions.
Thus, the point being made by PSP on the list of the 127 professions is a red herring – the list does not confer any free pass to any Indian nationals.
The second common criticism is that intra-corporate transferees from India can also freely enter Singapore to work.
Based on my explanation on how the chapter works, this is again not true. Intra-corporate transferees also have to meet our work pass qualifying criteria.
In any case, the total number of intra-corporate transferees, from all over the world and not just India, that have come to Singapore to work is very small. In 2020, there were only about 500 intra-corporate transferees from India in Singapore – less than 0.3 per cent of all EP holders.
So, Mr Speaker Sir, I hope we can put a stop to all this misinformation about our FTAs in general and CECA in particular.
THE REAL CHALLENGES
Nevertheless, it is important that we need to recognise that PMEs in Singapore do face challenges.
And I see at least three challenges that they are facing.
First, there is more competition from foreign PMEs. Indeed, the number of EP holders has increased, from 65,000 in 2005 to 177,000 in 2020 – so an increase over 15 years of 112,000 or an annual growth rate of just under 7 per cent.
Over this period, however, the increase in number of local PMEs is much higher, by over 380,000. So 380,000 for local PMEs, 112,000 for EP holders.
And these numbers underline an important point: That competition between foreign and local PMEs is not a zero-sum game.
In fact, the converse is often true. By combining and complementing local and foreign expertise, we can attract more investments and create many more good job and career choices for Singaporeans.
The downside is that with more foreign PMEs in Singapore, they can compete for jobs with locals at the company level and at that level, there can be a zero-sum situation.
So there is a trade-off at play here, if I put it simply: (A) Many jobs, strong competition; (B) few jobs, no competition. And we need to find the right balance where there are more jobs, some competition.
And that is the way to advance the interest of Singaporeans – not swing to an extreme position, but strike that careful balance and then adjust if we find that that balance is off.
But if someone promises you more jobs, no competition from foreigners, they are selling you snake oil. It is not possible. It cannot be on any government’s policy menu.
I should point out that besides complementing our local workforce to create more opportunities, foreign PMEs also help cushion the impact on the local workforce when times are bad. Because during a downturn, foreigners bear the brunt of job loss.
During COVID-19, for the 12 months to April 2021, the number of Employment Pass holders dropped by about 21,600 and S Pass holders fell by about 26,800. On the other hand, local employment has been stable. Unemployment rate for local PMEs in June 2020 – despite this is immediately after the “circuit breaker” – was at 2.9 per cent. Resident unemployment rate – September 2020 was 4.8 per cent; May 2021, 3.8 per cent – came down by 1 percentage point. Without the foreign buffer, when our economy ran into trouble, the situation would have been much worse. Singaporeans would have lost many more jobs.
So while the stock of EP and S Pass holders can fluctuate, Singaporeans enjoy greater security of employment, with help from various Government measures. Jobs Support Scheme held firm, helped enterprises keep their workers. We have a multi-ministry national jobs council that came up with many initiatives to help place displaced Singaporeans into jobs, including also a job growth incentive to help to encourage companies to hire local workers. So when Mr Leong Mun Wai said in his Facebook post that we need to recoup a few tens of thousands of jobs from foreign work pass holders, he may not know that we have already done so. This always happens in a downturn.
The second challenge is the profile of the foreign PMEs. They are concentrated in certain sectors, and from certain countries of origin. And indeed, as our digital economy and our needs for tech talent grew, more PMEs from India came into Singapore, through our EP framework.
And when that concentration happens in areas such as Changi Business Park, some may feel that we have lost a part of Singapore. Members of the House have raised this concern. We are taking this seriously and studying what we can do to lessen the problem.
I hasten to add that dealing with excessive concentration is not a straight-forward matter of chopping up the operations of a company here. We don’t want to unintentionally cause the whole investment to move elsewhere. And this will hurt even more Singaporeans. And this is part of the careful balancing that I talked about earlier.
Third, at the company level, there may be unfair hiring practices, with department heads preferring to hire foreign PMEs or even foreign PMEs from certain countries.
And this is not right. Whatever system we set up, there will always be some abuses. We must tackle the abuses when they occur as swiftly as possible, while continuing to adopt sensible economic policies that are good for Singapore and Singaporeans.
MOM takes a strong stance against such discriminatory practices and together with our tripartite partners has been actively enforcing against errant employers. The Minister for Manpower will speak on this further.
I have explained the underlying reasons for the difficulties faced by our PMEs, so that we know what it means for us in terms of public policy choices and how we can most effectively address the challenges. If we mistakenly blame FTAs and CECA for these problems, our responses would be disastrously wrong and would make our problems worse.
BE CAREFUL OF THE RISE OF XENOPHOBIA AND NATIVIST POLITICS
As I explained earlier, our FTA strategy has benefited Singaporeans and Singapore. So it is disappointing that FTAs are now a target of political attack. But perhaps, I should not be surprised as this has happened in many countries.
Such a debate goes beyond FTAs. The question of global versus local has emerged as the new dominant political divide in democracies around the world.
In the US, labour unions and various industry lobbies are against free trade. The Trump Administration pulled out of the Trans-Pacific Partnership (TPP) within a week of taking office, even though the US was the architect of the TPP agreement.
In the UK, Brexit was the culmination of a bitter political contest between those who want to be part of the European Union and those who wanted out.
In France, the next presidential election is likely to be a face-off between the incumbent President Macron and the far-right nationalist candidate.
These political divides arose because of globalisation. While globalisation presents opportunities and creates jobs, it also brings about greater competition, displacement of industries and jobs, inflow of immigrants.
These consequences go beyond the economic sphere, and often strike at the heart of a nation and a community’s sense of identity and security. And this is the most unsettling change, causing people to become unsure if they are on the whole better with globalisation.
And such concerns are genuine, and deserve serious and proper attention. We are a small country, and an unrestricted flow of workers from a large country can change the lived experience of Singaporeans, alter the character of our society and even overwhelm us. But we need to be careful that these valid concerns are not exploited by political groups and intentionally or not, end up sowing division, stoking fear, fanning hatred.
As representatives of the people, we all have a responsibility to realise that our words and deeds can shape public opinion and the direction of our political discourse.
That is why when Mr Leong Mun Wai said in this House some months ago that the naturalised Singaporean CEO of DBS was not “home grown” and deemed this a failure, Minister Iswaran responded with a word of caution. And I agree with Minister Iswaran and feel that Members of the House should be very careful about what we say on such matters if we are not to give credence to very negative, even ugly, minority view.
And that is also why we appreciate the Leader of the Opposition standing up to say that when it comes to racism and xenophobia, we all have to reject them and there can be no “if”s and “but”s about it.
CONCLUSION
Mr Speaker Sir, before I conclude, let me remind Members that the House has invoked Standing Order 44 so that the members from the PSP can give a full response after Dr Tan See Leng’s speech. Even if Mr Leong Mun Wai and Ms Hazel Poa choose not to, I will be happy to clarify questions from members.
The PAP always fights for the welfare of Singaporeans. We have done so for more than 60 years now – kept our country safe, brought jobs to Singaporeans, built up our infrastructure, and taken care of the welfare of all.
As a city state connected to the world, we want to welcome diverse talents from all over the world.
And when they are here, we invite them to fit into our society, respect our social habits and norms, appreciate our multi-cultural society. Join us at the hawker centres, try some durians, try some “sambal belacan”, speak a few phrases of Singlish.
And when Singaporeans go overseas to live and work – and about 200,000 of us do – we also expect the same of ourselves and hope that we also receive hospitable welcomes from our foreign hosts too.
I decided to make this statement today so that we can approach the debate on the PSP’s subsequent motion with the right perspective and motivation. The House should continue to debate robustly the pros and cons of various policies to help Singapore navigate this balance between global and local.
But we must not inadvertently shake the bedrock that has enabled Singapore to succeed. We cannot survive – we cannot earn a living – without being connected to the world, without being welcoming to the world, without the House unanimously supporting our FTA strategy.
We must always be a big-hearted people, even while we grapple with the significant challenges of globalisation to forge the best path forward for Singapore.
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Tariffs have been the important aspects of world trade since the end of WWII in 1945.
Those who are knowledgeable with tariffs are an asset to their country.
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The Straits Times’ Editorial says
China’s rekindled interest in Pacific pact
PUBLISHED2 HOURS AGO on 25th May 2021 in ST
China’s interest in joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) deserves serious consideration. Membership of this ambitious 11-nation free trade agreement that took effect in 2019, two years after absorbing the shock exit of the United States, can make China a more reliable and attractive trade partner. It can also ease the Sino-American trade war and provide fresh motivation for the Biden administration to renew its ties with the region. At last year’s Asia-Pacific Economic Cooperation summit, President Xi Jinping stated his keenness to join the deal originally conceived to exclude China and preserve the United States’ role as the shaper of rules of trade amid major geopolitical and technological disruptions. Reports last week suggest Chinese officials are pursuing entry, and holding consultations with CPTPP members.
The Chinese move appears to be guided by Mr Xi’s search for new economic drivers to replace the nation’s diminishing competitive advantage from low labour costs. The benefits for China are manifold. The Washington DC-based Peterson Institute for International Economics says joining the pact could provide a boost of nearly US$300 billion (S$399 billion) to China’s national income by 2030. Its exports, as well as imports, would jump by more than US$600 billion in the same time period. For the 11 other signatories that include Singapore, Malaysia, Japan, Australia and Canada, the projected incremental income gains from China’s entry would be US$485 billion by 2030.
The process of joining the pact could be cathartic in helping China resolve the features in its domestic economy which jar with its trade partners. A CPTPP membership cannot come before deep domestic reforms such as creating a level playing field with state-owned and subsidised enterprises, clear rules for dispute settlement between investors and the state, acceptance of higher standards on intellectual property rights, labour conditions, data flows and digital trade. These could help alter perceptions that China uses coercion and unfair means to pressure competitors, a sore point in the US-China trade war.
While China presses on with its application, the Biden administration must make a move too. If it wants trade rules that support labour standards and address climate change, Washington cannot overlook its self-exclusion from a trade pact that encircles the world. A re-entry is regarded a politically difficult decision, especially before next year’s mid-term election with voters equating globalisation with job loss. But surveys show a majority of Americans do view trade as an opportunity for growth. The Biden administration has returned to other key global forums, rejoining the Paris Accord on climate change and the World Health Organisation. The CPTPP presents a worthy opportunity to re-engage the Asia-Pacific.
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Selling used equipment on Internet…
Can the manufacturer stop you?
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Forum: Do companies have the right to stop customers selling used products on online marketplaces?
PUBLISHED6 HOURS AGO on 9th July 2021 in ST Forum
I own a few Apple products and recently tried to sell away three items that I no longer need on several online marketplaces.
On Wednesday, I received a notice from Shopee that it had removed my Apple product listings due to legal pressure from Apple, because Apple has authorised only a few resellers in Singapore.
Can the authorities comment on the legality of such corporate tactics?
Companies do not have any rights to the products once they are sold to customers.
If consumers cannot resell their pre-owned products due to legal pressure from companies that want to protect their bottom line, then online platforms such as Carousell, Facebook Marketplace and Gumtree would cease to exist.
That may have detrimental multiplier effects on Singapore’s digital innovation and economy.
Brandon Lee
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No peace in trade…there will never be world peace…
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The Straits Times’ Editorial says
A win-win for transpacific pact, Britain
PUBLISHED2 HOURS AGO on 4th June 2021 in ST
The decision on Wednesday by the 11 members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) to allow Britain to formally start the process of joining the pact spells “win-win” for Britain, the CPTPP membership and the agreement itself. If its accession goes through, Britain would become the second largest economy in the grouping after Japan and its entry would expand the bloc’s combined GDP by around 25 per cent in US dollar terms. As a member, Britain would gain easier access to a market that is roughly the same size as that of the European Union, which it was once a part of. However, the size of its trade with CPTPP members is barely one-sixth of what it is with the EU – which suggests there is much potential for Britain to expand its trade with the grouping.
But this will happen only gradually. Britain already has free trade arrangements in place with seven CPTPP members and is negotiating deals with two others, which means the additional economic gains from joining the partnership will be limited at first. However, Britain would be able to use inputs from across the CPTPP member-economies to build new supply chains. For example, as Britain’s Secretary of State for International Trade Liz Truss explained, its automakers would be able to source parts from Japan to make cars and trucks in Britain and sell them tariff-free to Mexico, for example. Tariffs on some British exports would also come down faster under the CPTPP than under its bilateral trade pacts.
But the potential benefits of Britain joining the pact are more than just about trade. It would enable Britain to expand and broaden its economic influence in member-economies and help them accelerate their modernisation. It would also enhance the CPTPP’s attractiveness as a grouping, which might, in turn, encourage other countries to join sooner rather than later. South Korea and Thailand are among those who have already expressed interest. Even China indicated it would “favourably consider” joining – although it would need to undertake major reforms before it can meet the demanding standards set by the CPTPP.
But perhaps the biggest prize for Britain – which would also be welcomed by the other members of the grouping – would be if the United States is persuaded to rejoin the pact that it had originally initiated. Although this is not a priority for the Biden administration at present, the chances of the US joining are higher with Britain in than out, and more likely than the US doing a bilateral trade deal with Britain alone. Given Britain’s existing trade agreements with most CPTPP members, its route to accession should be smooth. However, members should ensure that Britain accepts the grouping’s terms of accession as they are rather than seeking a bespoke deal – which would set a wrong precedent.
Ngozi Okonjo-Iweala and the chair of WTO fisheries subsidies talks, Ambassador Santiago Wills of Colombia, welcomed civil society’s plea for a successful conclusion to the negotiations, visiting today an ice sculpture set up in front of the WTO headquarters by the #StopFundingOverfishing coalition of NGOs.
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What is trade when there is no nature?
No nature, no environment, there will be no life and no WTO to talk about.
Who are blocking the tabling of the resolution at the UN GA to set up a new and powerful UN Environment Council? Why? Is it due to greed, ego, selfishness, and self-centredness?
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What comes first?
Should the cart come before the horse?
Do the UN, WTO, WHO, and WEF, etc. know this?
When there is no environment, there will be no nature, and there will be no life, and there will be no WTO to talk about. It will be all lights off. Game over.
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The Straits Times’ Editorial says
WTO’s new chief off to a promising start
PUBLISHED2 HOURS AGO on 8th March 2021 in ST
The World Trade Organisation’s (WTO) new chief Ngozi Okonjo-Iweala has lost little time in signalling her priorities. In her first week after taking office last Monday, she has supported a call by Singapore, New Zealand and others to do away with restrictions choking supply chains for medical goods, equipment and other pandemic-related products. Not many see the WTO as a crucial spoke in the battle against Covid-19, but Dr Okonjo-Iweala has tapped her experience as former chair of the Gavi vaccine alliance to bolster the case against vaccine nationalism. Although she did not endorse calls for a waiver of intellectual property protections for Covid-19 vaccines – a contested concept – the former Nigerian finance minister backs an interim solution that asks pharmaceutical firms to grant more licences in developing countries. She has also indicated a role for the WTO in addressing climate change.
She has advocated carbon tax, adopted so far by only a few dozen nations including Singapore, as a means of boosting government revenues while also nudging climate-responsive behaviour. She has asked countries to be mindful of the carbon content of traded goods but also warned against climate-related trade restrictions against countries that need help with transitioning to green technologies. An agreement on fisheries she is pushing for might become the WTO’s most significant achievement more than 20 years after it last concluded a round of trade negotiations successfully. To prevent overfishing, the pact will urge nations to tackle fishery subsidies.
But her biggest job remains restoring the WTO’s credibility amid hardening Sino-American rivalry. A complex challenge is that China, the leading trading nation, has a centrally managed economy which conflicts with the core rules on which the world’s trading system is built. At the other end, the United States has frozen the WTO dispute settlement system that underpins predictability of multilateral trade. The Biden White House has yet to budge from the Trump administration’s inflexible stance as it maintains that the US’ concerns have not been assuaged.
Dr Okonjo-Iweala will have to muster all her political skills if the consensus-driven body she now leads is to make headway. The good thing is that the WTO has come under new management at a time of improved economic indicators.
The International Monetary Fund foresees an 8 per cent growth in global trade this year, with global gross domestic product rising 5.5 per cent after falling 4.4 per cent last year. Given the positive climate, it might be easier to show how trade can improve ordinary people’s lives. Indeed, if she can address the blows globalisation has received in the past decade and reinforce the value of multilateral trade in her term, she will have more than delivered.
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Digital solution and digital trade.
What else is missing?
Is digital the ultimate in IT, AI and robotic technology and science?
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The digital solution to America’s trade comeback
A swift return by the US to multilateral trade deals like the TPP is unlikely, but a sectoral approach in new growth areas is promising
Steven R. Okun for The Straits Times
US President Joe Biden holding a semiconductor chip prior to signing an executive order aimed at addressing a global semiconductor chip shortage, at the White House in February.PHOTO: REUTERS
PUBLISHED3 HOURS AGO on 13th March 2021 in Straits Times
The economic fallout of Covid-19 has deepened America’s class divide and further hastened the erosion of jobs held by the working class. As a result, the Biden administration has made a worker-focused economic recovery the foundation of its policy agenda, both at home and abroad.
US foreign policy will “fight for every American job and for the rights, protections and interests of all American workers”, promised Secretary of State Antony Blinken.
At the same time, the administration’s core international goal rests on rebuilding relationships with allies and partners.
Critics argue a worker-centric foreign policy, influenced by both the progressive wing of the Democratic Party and the legacy of former president Donald Trump’s “America First” policies and politics, will prevent the United States from returning to regional trade agreements, ceding yet more ground to China’s potential dominance of Asia.
Is the prognosis really this grim?
Not quite.
To be clear, the US will likely remain a reluctant multilateral partner for the time being.
Mr Trump read correctly the mood of the country having turned against globalisation and the mantra of free trade.
It resulted in tariff wars and other trade policies that he promised would “Make America Great Again”. This resonated with many Democrats.
The new administration’s worker-centric trade policy recognises both the attraction of that message and the policy imperative to address the inequalities created by globalisation and automation.
President Joe Biden’s efforts to boost domestic manufacturing jobs reflect that through an executive order that strengthens US supply chains for advanced batteries, pharmaceuticals, critical minerals and semiconductors.
As for Mr Trump’s tariffs, they will not be eliminated any time soon. Expect, however, a more robust, transparent and predictable exclusion process that will be more targeted at China while minimising the costs to the US.
And do not expect the imposition of tariffs on Vietnam as envisioned by Mr Trump had he won a second term.
Expect, as well, an increase in the use of dispute settlement mechanisms and new investment and tax incentives to reshore jobs.
Incoming US trade representative Katherine Tai views American workers not only in terms of employment but also as consumers, a driver of economic growth. Jobs and fair wages are necessary to fuel that engine.
MORE ON THIS TOPIC
What businesses can expect as US trade policy shifts under Biden
G-20 advances on digital tax after US drops key obstacle
Achieving these objectives does not require replicating Mr Trump’s pugilistic, bullying approach to trade.
While no realistic expectation exists for the Biden administration to rejoin the Trans-Pacific Partnership, or TPP (renegotiated and signed as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP) in its first few years, all is not lost, however.
Fatalist arguments about the US abandoning trade or its partners not willing to take US concerns into account in discussions on trade relations fail to acknowledge the China factor.
Increasing concern over Beijing’s growing clout and its willingness to use economic coercion to achieve its foreign policy aims will likely balance protectionist sentiments, both in Washington as well as capitals across the Asia-Pacific.
According to a recent survey from the ISEAS – Yusof Ishak Institute, more than 60 per cent of the respondents from Asean said they would choose the US over China if the grouping was forced to align with either power.
This mirrors the record lows in public sentiment in the US towards China.
The concern that two mega regional free trade deals – the CPTPP and the Regional Comprehensive Economic Partnership – went into effect without the US at the table as the region drafts its trade architecture will grow to alarm if China ever enters into negotiations to join the CPTPP.
The US implicitly recognises its national interest requires practising “geo-economics” in which policymakers cannot separate politics, economics and security, for which multilateral and plurilateral trade are a part.
Giving time for the geo-economic calculus to reveal itself, incorporating a worker-centric trade policy while taking a step-by-step approach to engagement can bring the US closer to the trade position of when the Obama administration ended than where the Trump administration left it.
Digital trade as a pathfinder
As a stepping stone to re-engaging regionally while the domestic and foreign policy dynamics play out, both the Asia Society Policy Institute and the US-Asean Business Council advocate a sectoral approach to trade.
Digital trade challenges policymakers to think across the spectrum of economic and societal issues, including consumer protection, privacy, cross-border data flows, cyber security and intellectual property protection.
To get digital trade flowing smoothly, market access and sectoral agreements are necessary.
MORE ON THIS TOPIC
US must put its house in order, listen to friends again: Experts
S’pore, US ink agreement on trade financing and investment cooperation
With so many businesses tying their model to digitalisation – think fintech, healthtech, agtech and edtech – a digital sectoral agreement has positive effects on all other parts of the economy.
Ms Wendy Cutler, vice-president at the Asia Society Policy Institute and senior adviser at McLarty Associates, supports the sectoral approach, with a digital agreement an obvious candidate to bring the US back as a leader on regional trade.
Such a deal is attractive as it may not need congressional approval, would be more straightforward to negotiate than a comprehensive agreement and would be a good way for the US to rebuild trust in the region and create momentum for a potentially more expansive agreement.
What’s more, negotiations for such a deal could build upon existing templates such as the Singapore-Australia Digital Economy Agreement or the e-commerce chapter of the United States-Mexico-Canada Agreement.
At the AmChams of Asia Pacific Business Summit held in Singapore this week, Deputy Prime Minister Heng Swee Keat flagged the opportunities offered by the digital economy and the potential benefits that can be reaped by both the US and the region.
The size of the digital economy in South-east Asia alone is projected to triple from US$100 billion (S$134.6 billion) last year, to over US$300 billion in 2025.
“US companies are well placed to tap on Asia’s digital dividend,” said DPM Heng.
“You continue to be at the forefront of innovation, with deep technology expertise, business models and the scale to reach billions digitally.
“You are also helping to shape the consensus around emerging policy areas such as the ethical use of artificial intelligence.
MORE ON THIS TOPIC
Countries must come together to uphold rules-based global trading system: Chan Chun Sing
US can lead the way in global digital integration, decisions should not be guided by politics: Chan Chun Sing
“These issues increasingly resonate with consumers in the region and the world.”
The US cannot depend on fear of China and the historical goodwill of its allies and partners alone to have it welcomed back as a driver of the global agenda.
It has to look forward and seek out new paths – and the digital economy beckons as an area where American companies can play to their strengths.
Sustainable development is another growth area. Like the digital economy, this new terrain offers more opportunities for growth and the rules of the road need crafting.
In other words, opportunities are here, too, for the US to play a leading role at the trade table.
It might take longer than proponents would like, but given time and political space, the Biden administration can reaffirm its commitment to a rules-based multilateral trade order in Asia without sacrificing its commitment to a worker-centric trade policy.
A digital trade agreement emerges as an obvious option in taking that first step.
Steven R. Okun served in the Clinton administration as deputy general counsel of the Department of Transportation. He is senior adviser for global strategic consultancy McLarty Associates and is also a governor of the American Chamber of Commerce in Singapore. David Dennis, graduate fellow of South-east Asia practice at McLarty Associates, contributed to this commentary.
FTAs, including Ceca, are vital to expanding Singapore’s economic space
Free trade agreements (FTAs) are in the news lately. For example, India decided not to sign the Regional Comprehensive Economic Partnership Agreement (RCEP). The RCEP had been negotiated, for seven years, by 16 countries. It would have created the world’s biggest free trade area.
India’s decision not to join the agreement was very disappointing to India’s friends, including in Singapore. We want India to play a leading role in our region. We hope that India will decide to join RCEP in the near future.
At home, some Singaporeans have attacked the free trade agreement between Singapore and India, called the Comprehensive Economic Cooperation Agreement (Ceca), concluded in 2005. The criticism is that Ceca contains a defect. The defect is that it has enabled too many Indians to work in Singapore, thereby taking jobs away from Singaporeans.
I was the leader of the Singapore delegation which negotiated the free trade agreement with the United States of America. In view of this, I would like to explain to readers:
• What is an FTA?
• Is there a difference between an FTA and a comprehensive economic partnership agreement?
• Are such agreements compatible with the World Trade Organisation (WTO)?
• What is the logic behind Singapore’s FTA policy?
• How have our FTAs benefited the Singapore economy, Singapore’s exporters and the people of Singapore?
• Is the criticism against Ceca valid?
FREE TRADE AND THE WTO
It is a well-known fact that Singapore’s external trade is three times the size of its economy. Trade is therefore our lifeblood. The rise of Singapore and the other countries of East and South-east Asia has been due substantially to free and open trade and the international division of labour.
The international institution which governs global trade is the World Trade Organisation. The WTO has a body of laws and rules governing trade in goods and services between countries. In the event of a trade dispute, the WTO has a system of binding dispute settlement.
Singapore’s allegiance to the WTO is of primary importance. We strongly support the transparent and non-discriminatory rules-based multilateral trading system embodied by the WTO. Singapore has not done and will never do anything which undermines the WTO’s credibility and efficacy. On the contrary, Singapore firmly supports efforts to strengthen the efficacy and relevance of the WTO.
BILATERAL AND REGIONAL FREE TRADE AGREEMENTS
The WTO has 164 member states. The WTO works by consensus. These two facts explain why it takes a long time for the WTO to arrive at agreements. For this reason, some WTO members felt that it was necessary for like-minded countries to conclude bilateral and regional trade agreements, to complement and not to replace the WTO.
In 1996, this position was endorsed by the leaders of the Asia-Pacific Economic Cooperation (Apec) forum. Singapore has followed the principle that whatever bilateral and regional trade agreements it has negotiated must be compatible with its obligations under the WTO.
SINGAPORE’S FTA POLICY
Singapore’s FTA policy was conceptualised and launched by former prime minister Goh Chok Tong and former trade minister George Yeo 20 years ago. Why did they do it?
They did it to expand Singapore’s economic space. The strategy was to link our small economy to the economies of other bigger countries.
In this way, Singapore will be more deeply connected to the global supply chain and our exporters will have lower tariff or non-tariff barriers. To keep up with the progress of technology, we are expanding our FTAs into the digital sphere.
Singapore has been prolific in negotiating FTAs. To date, Singapore has concluded 13 bilateral FTAs and 12 regional FTAs. The two most recently concluded agreements are the RCEP and the agreement with the Eurasian Economic Union (Russia, Armenia, Belarus, Kazakhstan and Kyrgyzstan).
It is estimated that our FTAs are with countries that collectively account for more than 85 per cent of global gross domestic product and account for over 90 per cent of Singapore’s trade. This is a very impressive achievement.
FTA AND COMPREHENSIVE ECONOMIC PARTNERSHIP
Some of our agreements are called FTAs, like the one with the US. Others are called comprehensive economic partnership or cooperation agreements, like the one with India. Is there any difference between them? In theory, comprehensive economic partnership or cooperation agreements are supposed to have a wider scope than FTAs. In practice, there is no difference between them. The two terms are used interchangeably.
GAINS AND LOSSES
Every FTA is the result of negotiation. In every negotiation, compromise is necessary.
Each negotiating party must be prepared to make concessions to the other party or parties. At the end of the negotiation, however, every party must have gained more than it has lost. This is possible because free trade improves efficiency and FTAs are win-win agreements. Otherwise, there would be no agreement.
This is true of the US-Singapore FTA and the India-Singapore Ceca.
BENEFITS OF THE US-SINGAPORE FTA
How has the US-Singapore FTA benefitted Singapore?
First, it has enabled Singapore’s exporters to gain tariff-free access to the US market of 330 million consumers.
Second, it is not sufficiently known that the US has more investments in Singapore than it has in any other Asian country and more than the US investments in China, India and South Korea, combined. The primary attraction is that Singapore has the best intellectual property rights regime in Asia. The US investment has created many good jobs for Singaporeans.
Third, there are 4,500 US companies that have established factories or regional headquarters in Singapore. This has also created jobs for Singaporeans and benefits to our economy.
ANY LOSSES FOR SINGAPORE?
Did Singapore make any concessions to the US which it would not have done without the FTA? I can think of two.
First, the term of copyright has been extended from the life of the author plus 50 years to 70 years.
Second, Singapore would not have created a special category of medicated chewing gum, in order to satisfy the US manufacturer of chewing gums, Wrigley, in the absence of the FTA.
However, these are small concessions compared with the many gains for Singapore.
INDIA-SINGAPORE CECA
How has the Ceca benefited Singapore? It has benefited Singapore in the following ways:
• Eliminated most tariff barriers to access the Indian market;
• Enabled DBS Bank and United Overseas Bank to provide integrated banking services in India;
• Allows Singapore companies in sectors such as infrastructure, logistics and manufacturing to invest in India with greater confidence due to Ceca’s provisions on intellectual property rights and dispute settlement.
In 2016, India accused Singapore of not honouring its commitment under Ceca by blocking Indian IT professionals from securing the necessary work passes to work in Singapore. The issue was discussed during the second review of Ceca, which was concluded in June last year. The two governments decided not to make any changes to the chapter on the movement of people.
This issue is politically sensitive in both India and Singapore.
The Indian government is under pressure from its domestic constituency to ensure that Indian professionals are fairly treated. The Singapore Government is under pressure from its domestic constituency to ensure that there is fair competition for jobs and that Singaporean job seekers are not discriminated against.
Ceca does not guarantee Indian professionals jobs in Singapore nor preferential treatment over Singaporeans. What Ceca confers is for intra-company transferees and professionals from India to work in Singapore for specified durations, provided that they meet our work-pass qualifying criteria.
CONCLUSION
I shall conclude with the following three propositions.
First, Singapore lives by trade and, for this reason, attaches the greatest importance to the WTO.
Second, Singapore has pursued a proactive policy of negotiating bilateral and regional FTAs with other economies. The aim is to expand Singapore’s economic space and to enable our exporters to gain preferential treatment, including tariff-free access, to overseas markets, including those of the US, China, Japan, the European Union, India, etc.
Third, Ceca has brought many benefits to Singapore and to India. India is a talent surplus country and Singapore is a talent deficit country.
As long as the import of Indian talent is to fill the gap and not to displace Singaporeans, this is a plus for both countries.
• Professor Tommy Koh, a veteran diplomat, is ambassador-at-large at the Ministry of Foreign Affairs. He was the leader of the Singapore delegation that negotiated the FTA with the US and chaired two WTO dispute panels.
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What Ceca confers is for intra-company transferees and professionals from India to work in Singapore for specified durations, provided that they meet our work-pass qualifying criteria.
Unquote.
Conditions are: specified durations; work-pass qualifying criteria.
Will the POFMA be applied against those who spread false information or distort the facts with untruths?
It is a joy to share, and the more I share, the more it comes back in many ways and forms. Most of what I shared are not mine. I borrowed and shared it on my Blog.
If you like any particular post in my Blog, please feel free to share it far and wide with your loved ones, friends and contacts.
You may delete my name before sending it to them.
You may also use the articles to write on the same topic or extract and paste any part of it in your article.
My posts are available to all, young and old, students too.
If they wish, they can extract or plaglarize any of the points to write their articles or essays with it. Np.
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I share what I wrote worldwide with Facebook friends and contacts, not with Singaporeans only.
I share it by pasting the link method as it is easier and a shortcut rather than copy paste my comments in full text.
Some want me to stop posting. I shall stop giving comments and/or my link when others stop posting. When they stop, I stop.
When they continue to give comments, I shall continue to give my short-cut link, or a short cut-and-paste comment plus the link.
If I stop giving my link or comments, it will by default be letting others a free hand to give possibly a one-sided comment without anyone giving the other perspective on an issue.
If I stay quiet, it will be considered my failure not to give the opposite perspective.
Some want me to be silent, and to stop posting.
If I accept their demands, it will be a failure to my Facebook friends worldwide by staying silent.
I owe it to my Facebook friends and to the society to comment and give an opposite perspective on an issue.
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My contact: tankoktim@yahoo.co.uk
tankoktim 