He expressed hope that German SMEs would expand in Singapore and use it as a gateway to Asia
By Lee U-Wen, The Business Times, 5 Feb 2015
By Lee U-Wen, The Business Times, 5 Feb 2015
THE government will continue to maintain the importance of manufacturing in the Singapore economy, said Prime Minister Lee Hsien Loong at the end of his four-day official visit to Germany on Wednesday.
"It has to be the sort of manufacturing that fits our circumstances, and we do want manufacturing as an important pillar of our economy," he told the Singapore media in an interview in Berlin.
The companies in Germany are strong when it comes to manufacturing, and Singapore is ready to work closely with them and help them succeed in Singapore, he stressed.
On this trip to Germany, his first since 2005, he spent some time over the last four days meeting representatives from various German businesses to understand their views and concerns.
"It's important that when I travel, I take the chance to talk to company executives so that they hear from me first-hand and understand what the Singapore government's stance is," said Mr Lee.
Among the many representatives of German firms he met on this visit were those from the likes of semiconductor manufacturer Infineon Technologies, and engineering giants Siemens and Bosch - all prominent multinationals that have had long histories of doing business in Singapore.
Mr Lee expressed hope that more of the German "Mittelstand" - the small and medium-sized enterprises that form the backbone of the German economy - would consider expanding in Singapore and use the Republic as a gateway to Asia.
Whether they are big or small, he said, German businesses shared similar concerns about investing in Singapore.
"One of the major issues that is critical to them is that, in Singapore, they get consistency in policy, regulatory transparency. Ours is a clean system, a company's intellectual property is protected, and they can depend on what we say being fulfilled and honoured, not just in the short term but over the long term too."
Mr Lee assured them that the government would uphold the system that has worked well for them, and that the Singapore economy would continue to upgrade itself over time."We are keeping the economy on an even keel. We are upgrading, we are helping the companies to upgrade. We are managing the inflow of foreign workers and executives. While we have to control the numbers, we will continue to rely upon them."
Mr Lee brought with him on this trip a large delegation of business leaders led by International Enterprise (Singapore) and by the Singapore Business Federation.
In the hour he spent over breakfast with most of the executives on Wednesday, one of the main issues that emerged was that of the ongoing shortage of manpower.
While he was unsurprised at this, he noted that many of the Singapore companies were generally doing well and that some had successfully ventured abroad, both in traditional markets and far-flung ones.
"They told me how they've expanded overseas, and many have significant operations in Iskandar (in Johor), Batam, China, Thailand. One company even has an operation in Brazil. That's the way our companies have to go - have some operations in Singapore, but also overseas. Then, you are successful because of your combined presence in many parts of the world," he said.
At this point in the interview, he reiterated the need for Singapore to have a strong and thriving economy that could generate good jobs for the people and pay good salaries.
"We must have a vibrant, humming economy (that) must be successful. That's what we have been trying hard to do, and we are trying hard to get people to understand that this is important," he added.
With the Germany leg of his week-long European trip complete, he and his delegation made their way to Madrid on Wednesday night to begin a two-day official visit to Spain.
While in the Spanish capital, he will have an audience with King Felipe VI, the 47-year-old monarch who began his reign last June following the abdication of his father, Juan Carlos.
Mr Lee is also scheduled to meet Prime Minister Mariano Rajoy and a number of key ministers.
Four ambassadors with a remit to woo German SMEs
By Zakir Hussain, The Straits Times, 5 Feb 2015
By Zakir Hussain, The Straits Times, 5 Feb 2015
BERLIN - Singapore's Economic Development Board (EDB) has appointed four heads of medium- sized German companies with extensive experience in Asia as Singapore's economic ambassadors, as it marks 50 years of trade relations with Germany.
Over the next three years, this pioneer batch of ambassadors will encourage firms like theirs to develop their business in Singapore.
They will also advise German small and medium enterprises - known as Mittelstand - on how to operate successfully in Asia.
Prime Minister Lee Hsien Loong presented them with certificates of appointment at a ceremony on Wednesday, as he wrapped up his four-day visit to Germany.
The four ambassadors are Dr Michael Schadlich, former chief executive of automotive manufacturer Dorma Group; Mr Thomas Fischer, chairman of the supervisory board at automotive and filtration equipment supplier Mann+Hummel; Mr Peter Riedel, president and chief operating officer of electronics group Rohde & Schwarz; and Dr Gunther Kegel, chairman of automation and sensor technology manufacturer Pepperl+Fuchs.
EDB chairman Beh Swan Gin said: "They are considered key opinion leaders in their respective fields and are very well-positioned to provide practical advice to Mittelstand companies on undertaking R&D, manufacturing, operations and general management in Singapore and in Asia."
Dr Beh noted that Singapore shared many of the Mittelstand companies' core values.
These include a long-term view on investments and business, an emphasis on trust and reliability, investment in research and development and education, and a commitment to excellence.
One of the new ambassadors, Mr Riedel, said: "Singapore not only provides a pool of skilled workers, a stable legal system and the protection of intellectual property, but also offers close proximity to the fastest-growing markets in the world."
His counterpart Mr Fischer described Singapore as a "trustworthy hub in Asia", and added: "We can rely on its political and legal conditions, and have access to excellent suppliers."
German foreign direct investment in Singapore totalled €1 billion (S$1.5 billion) in 2013, the largest amount of German investment in South-east Asia.
German foreign direct investment in Singapore totalled €1 billion (S$1.5 billion) in 2013, the largest amount of German investment in South-east Asia.
Some 1,400 German firms have a presence in Singapore.
Dr Beh noted that several Mittelstand companies are sponsoring polytechnic engineering graduates from Singapore to study in German universities of applied sciences, after which they will be offered work opportunities in the companies' Singapore operations.
Separately, another group of German multinationals and Mittelstand companies are working with the Singapore Institute of Technology to pioneer a dual studies degree programme in Singapore.
Territorial disputes can be set aside: PM Lee
Prime Minister Lee Hsien Loong spoke on the rise of China, rivalries in South-east Asia and the pragmatism with which a small country secures its influence in an interview with German newspaper Sueddeutsche Zeitung during his visit to Berlin this week. Here is an edited translation.
By Stefan Kornelius, The Straits Times, 6 Feb 2015
Prime Minister Lee Hsien Loong spoke on the rise of China, rivalries in South-east Asia and the pragmatism with which a small country secures its influence in an interview with German newspaper Sueddeutsche Zeitung during his visit to Berlin this week. Here is an edited translation.
By Stefan Kornelius, The Straits Times, 6 Feb 2015
MR LEE HSIEN LOONG is Prime Minister of a small country with a big name and influence that should not be underestimated. The city-state Singapore with its 5.4 million inhabitants might seem tiny next to the major Asian powers. But as a traditional trade and transfer hub with excellent relations to all regions in the world and with Western thinking prevalent among its political elite, Singapore has always been arbiter, interpreter, and a microcosm for European and American projections of South-east Asia.
Mr Lee, 62 years old and Prime Minister for 101/2 years, went to school in the West and rose to the state's pinnacle after a long military and political career. It was certainly no obstacle that his father and Singapore's founding prime minister Lee Kuan Yew turned the city-state into what it is today: A multi-ethnic small state with a good track record for integration, led with a firm hand, governed de facto by one party, strictly geared towards increasing prosperity, and friends with both China and the United States.
Mr Lee, 62 years old and Prime Minister for 101/2 years, went to school in the West and rose to the state's pinnacle after a long military and political career. It was certainly no obstacle that his father and Singapore's founding prime minister Lee Kuan Yew turned the city-state into what it is today: A multi-ethnic small state with a good track record for integration, led with a firm hand, governed de facto by one party, strictly geared towards increasing prosperity, and friends with both China and the United States.
During his visit to Berlin, Mr Lee emphasises in an interview with Sueddeutsche Zeitung that this traditional role of balancing between major players is not just part of Singapore's central political understanding but also of most other South-east Asian states. "Everyone in the region wants to make friends with China and gain from the opportunities from its rise," says Mr Lee. "But at the same time, they would like the region to be open, to be stable and to maintain the relationship with Europe, America and the rest of the world."
The economic boom in China and its neighbouring states has given rise to a certain understanding of realpolitik which Mr Lee can easily describe: "It is not just a power matter; it is also a matter about your reputation internationally." With a view to China, he asks: "What image would you like the world to have of you?" According to him, it is impossible to understand day-to-day skirmishes without a long-term perspective: "The US is still a major player in the Pacific but it is not the only one. It is not the number of ships that is decisive but whether the US positively and constructively maintains its relations to the states in question. We do not want to choose between China and the US."
Mr Lee nevertheless does not deny that tensions between South-east Asian states have grown - especially due to unresolved territorial claims in the South China Sea and questions of maritime sovereignty. His typical pragmatism becomes apparent when he states that: "China with more resources and wealth, can become more assertive in defending and advancing its sense of its rights and what it is entitled to. Nationalism plays a role in China and other countries in the region. If disputes are burdened by nationalism, and also loaded with a historical dimension, then it is impossible to solve them. But disputes can be set aside. The parties involved can agree not to settle this, but you move on and try to keep the relationship on an even, practical and constructive level."
Setting aside problems and benefiting from one another: Mr Lee never tires of referring to the long historical dimension with which Asian states and especially China tackle their day-to-day problems. According to him, territorial disputes can never be resolved to everyone's satisfaction. "No one can produce documents that can prove a historically indisputable ownership claim. All you can say is, there were fishermen or sailing junks that were in this area, and human beings who have been living in this part of the world for thousands of years. All you can do is agree to disagree, and manage the disagreement so that you do not accidentally have two boats colliding or two aeroplanes crashing or exchange of fire and events spiral out of control. It is not a good basis for discussion when someone says: 'What belongs to me belongs to me'."
Since last year, the dispute about the various archipelagos and seafaring rights in the South China Sea has been pending before the International Tribunal for the Law of the Sea in Hamburg. The Philippines is pushing for clarification. The subject of the proceedings is China's claim to exercise not just commercial rights such as fishing but also other sovereign rights within a 200-mile zone. If, for example, China were to make use of these rights and prevent merchant ships from passing through, this could considerably limit international maritime transport and provoke massive tensions in the much-frequented South China Sea.
Singapore, which is situated between the South China Sea and the Strait of Malacca, and as a trading nation depends on the routes being kept open, takes a clear stance: "Freedom of navigation is crucial, it is a very serious issue," Prime Minister Lee remarks. "No one knows exactly what the Chinese claim. Two hundred miles, the Nine-Dash Line or island territories: I suspect it would be disadvantageous for them to spell out exactly the basis of their claims. So they would just claim and assert what they have drawn on their maps."
Mr Lee suspects that the maritime tribunal in Hamburg will not be able to resolve the conflict either. China questions its authority even though the Chinese ratified the United Nations convention which forms the basis of maritime law. For Mr Lee, this is "taking a big-power position: What I assert is mine and I will continue asserting it's mine".
The Asean group of states is working on a binding code of conduct which would at least regulate actual interaction between the parties in the areas of tension. "This will take time," the Prime Minister believes. However, he also makes it unmistakably clear that the disputes are not caused by territorial claims but chiefly by a demonstration of assertiveness.
Japan's role in region
MR LEE, however, takes a different stance when it comes to Japan's role in the region which, according to him, is primarily shaped by a heavy historical burden. Tensions between China and Japan about the Senkaku/Diaoyu islands are the expression of profound historical resentment, he says. When asked whether China and Japan should try to find a common view of history, Mr Lee laughs out loud. "This is impossible. On one side, nothing has been forgotten and, on the other, nothing is remembered." According to him, more than one generation of young Japanese has grown up without knowing all the bad things that were done by the Japanese military government, as well as their soldiers all over China and Asia, while the Chinese government practically cultivates the image of Japan as an occupying force. "Now there is a new generation in the Japanese government which wants Japan to be a normal country without wanting to assume responsibility (for the past)." The German way of coming to terms with its past is "unimaginable" in Japan, he says.
Mr Lee, however, shows understanding for Japan's attempt to counterbalance China's influence in the region. "From an economic point of view, they will be able to do so and definitely with regard to technology. But when it comes to the projection of power, they will not be able to compete with China. If Japan wants to have more influence, then this would only be possible in a way that does not evoke old fears. They have not yet reached that point."
The Prime Minister calls on Germany and the European Union (EU) to play a more active role in the region. While there are 1,400 German companies in Singapore, Mr Lee always perceives a certain hesitation in European investors. A good example of such hesitation is the EU-Singapore Free Trade Agreement which could still be brought before the European Court of Justice and had introduced the Prime Minister to the subtleties of European bureaucracy.
Mr Lee also demonstrates political pragmatism when it comes to European issues of war and peace. He is clear about Russia's historical sphere of influence in Ukraine and accuses the EU of ignoring the Maidan Revolution's repercussions. "You may not like Mr (Vladimir) Putin's style, but these are geostrategic realities" which, however, must be balanced by questions of territorial integrity, he says. "Countries cannot go round annexing other countries."