Singapore's Emeritus Senior Minister Goh Chok Tong delivered the keynote speech at the 22nd International Conference on The Future of Asia in Tokyo, Japan on Monday (May 30), the first day of the event.
His speech at the annual Nikkei Conference, titled "Rising to Global Challenges and Realising Asia's Potential", was followed by a dialogue session.
Here are some edited excerpts from the dialogue:
On historical legacies affecting China-Japan-US relations and the region
ESM Goh: "I see the visit by President Obama to Hiroshima and I must here add that I happened to be there some years ago, I can understand the reason. It is important because symbolically, it shows the two countries are further down the road to close another chapter on the past.
"This symbolic gesture is important because Hiroshima was a huge tragedy for the Japanese as a result of Japan's war in the Pacific. And if the same kind of symbolism or gesture can be made between Japan and China, that would go a long way to creating peace for the whole region.
"The comfort women issue between Japan and Korea has more or less been resolved, so now the difficult part is Japan and China. And the complication is because China is a rising power. And when China rises, it's not just a matter of adjustment for countries in the region but the world's biggest global power must (also) accept and adjust to a rising power.
" So therein lays the complication because the US takes a long view - 20 years, 30 years down the road. Would the US remain the world's sole superpower or work together (with China) to make this better world for all of us? Japan, being a neighbour of China, and an alliance partner with the US, would have to play a very clever and constructive role.
"If Japan comes across as distrusting China and taking steps with others to contain China, then we are going to have ill relations for a long time. I am not saying that Japan is doing that but Japan must not risk a perception of being seen as working to keep China from rising."
On resolving the past and changing the mindset for the future
ESM Goh: "The first requirement will be that leaders on both sides, in this case, China and Japan, see the future and the benefits of cooperation over using the past as an issue for their own internal purposes because within each country, they have very strong feelings over (the past) and sometimes it's convenient for political leaders to keep certain things on a boil so that they can turn up nationalism for domestic politics. (So) You require strong leaders to say the future of the people is more important and how you get into that position for the future, which means you do require initiatives by leaders in the region, to say, 'war never again', because war is going to destroy lives of many people.
"And today is not like the old days. Should there be war, it's going to be much more destructive than before, even without the use of nuclear weapons. And I do not see the scenario where China is being hammered and close to defeat, and not use the ultimate weapon.
"So there is this debate whether (atomic) bombs should have been used (in World War II). But the Americans weigh the lives of Americans versus lives of Japanese, which is more important for them? So the bomb was dropped. So if you have war, the scenario is horrendous.
"I have been Prime Minister for 14 years, looking after a small country and for us, it is a question of survival. It's an essential question because we have many challenges and sensitivities. If we don't handle our situation well, Singapore will cease to exist as a sovereign country. So at the age of 75, I don't look backward, I don't write memoirs. I am more interested in the future of the next 50 years. I won't be around but I am interested in doing what I can try and get the presidents and future leaders, to understand that we must work together for our common future."
On the South China Sea issue and how countries should respond to the impending arbitration ruling
ESM Goh: "First, put yourself in the position of the other party in order to get a better understanding, so that we can then try and find common ground. If we merely look at issues from our position and neglect or refuse to look at it from the other person's perspective, then we are not going to come to any agreement. So, big as China is - and I am not being an apologist for China because I will speak on the South China Sea issue after this - China fears for its own security.
"In the last century, China has been humiliated and occupied by many foreign powers. (So) Chinese leaders say never again would they allow China to be humiliated. And from China's point of view, they can see bases being built around China all over - Korea, Japan, Philippines, Australia and maybe even Vietnam, maybe India. So you might be very big as China, yet you ask yourself 30,50 years from now, will you be strong or will you be contained?
"So it is not (so much) Japan but it comes back to China reaching an understanding with the US, or put it the other way, US accepting China's rise and making positive steps to ensure that China's rise will be beneficial to the world and not a threat. It's not so easy but the US and China now have more areas where they are having discussions to build up their relationship in those areas, rather than areas of disputes.
"What is Singapore's position on (the disputes)? If I may use public housing in Singapore as an example - where we have occasional disputes between neighbours over small issues which become big issues if not handled well - how do we resolve them? I think there's a parallel there for international disputes.
"First, we encourage the two neighbours to try and solve it bilaterally, that's called bilateral resolution. If you can't solve this bilaterally, then what happens? Well, we use community leaders to informally get the two (sides) together. So the community leaders are like Asean - you would try and get them to see each other's point of view and come to a solution peacefully and with no violence, no fights. If that doesn't work, in recent years, we have set up a mediation centre, to counsel and mediate disputes. Mediation is not by law and it is not enforceable but it's a proper mediation centre. And when we find there are some neighbours who are quite troublesome and do not abide by the mediators' ruling, we have recently set up arbitration as the final platform for them to resolve disputes. When both parties go for arbitration, the findings of the arbitrator, the judgement, the verdict are binding. They enforce it."
"So when it comes to the South China Sea - I make it clear here that Singapore is not a claimant but we have interests in freedom of navigation and overflight - how will this be resolved? There are certain principles. One, we say resolve it peacefully. As a small country, if we can't resolve an issue, we would take the rule-based route. We had a dispute with Malaysia. We referred our dispute to the International Court of Justice which gave a judgement and both sides accepted the ruling. That's what we meant by rule-based regime.
"The complication is that China has refused to join the Philippines' arbitration submission. We cannot drag China to the court. Unlike the case in Singapore where the arbitration verdict is enforceable, this case is not enforceable. But there's a certain moral angle to the judgement, and so the Chinese are hoping for many countries to be on their side, not to issue any statement on this. If you talk about Asean, Singapore is now the Asean-China relations coordinator. I think the matter is being discussed whether Asean will issue a statement. It's too early for me to predict but the matter will have to be discussed among the Asean members first."
On the power of diplomacy and Singapore's role in the Xi-Ma meeting in Singapore
ESM Goh: "We are friends of both Taiwan and PRC and they know our position (on One China). We recognise that Taiwan is part of China and that is very important. We recognise that and we understand both sides' positions. We did not and will not act as intermediary - it's too complicated - but we provided a neutral venue for them to have the discussion. We did not invite them to meet in Singapore. As I said, we are not intermediaries. If they feel they want to meet one another and they can't meet in each other's place, which neutral country would they go to? Japan, I think not. America, no. Korea, no. So where? I think Singapore is a natural choice for them. We provide facilities and security arrangements, and they feel comfortable. What they discuss is between themselves. That is the strength of Singapore. We are quite clear (that) we don't take sides, and our position is very clear that Taiwan is part of China."
On the impact on the world if Republican nominee Donald Trump wins the US presidency
ESM Goh: "If (Trump) wins, we can certainly say he's no President Obama. He's a very different character. Are we seeing the real Trump character now, the real policies? I don't know because he is in a campaign mood. To campaign and win, he must know the pulse of the people. He's able to tap into the disaffection in America at this stage, in particular, white working class Americans. Clever with his language, with his rhetoric, with his bluntness, he's able to tap into that anxiety and even anger in the population to become the candidate for the Republicans.
"What would his policies be? Will he listen to advice later on? I don't know, but I think he would listen and become more presidential. You cannot comment on what the world would be like under President Trump because he has (thus far) come across as a politician. At the moment he's in a very different mood, in a campaign mood. I think, for our sake, he has to change his policies. What he has articulated now may not be his policies in future."
On rising populism and inward protectionism around the world
ESM Goh: "This is a consequence of trying to win elections in a democracy. In the past, leaders would tell their people what the problems are and how do they resolve the challenges. Most people who became leaders in those times understood the problems. But in many democracies now, it is to win at all costs. To win, you must tap into the pulse of the people which could be disaffection with the economy. Sometimes it could be tapping into the populism streak, (in which case) you offer solutions which you know you cannot deliver. But at that moment, you tap into it, you win and then try and see what you can do about that (later). We see this as nationalism, which in a sense is populism at this stage, in many democracies in Europe. In a way, it's in America too, tapping into the angst of the people and it is a form of populism in trying to win elections. Democracy is passing through this fragile phase; how would it emerge? If as a consequence of this, the economies and societies of these countries don't do well, and instead of being harmonious, they fracture, then I think democracy will see very sad consequences.
"How to prevent it? I'll give the example of Singapore. We have been accumulating reserves over the years because we believe in a balanced Budget. We never spend beyond our Budget and we always commit our reserves for a rainy day and this rainy day would include an aging population. Very early on, we anticipated that whilst my party, the People's Action Party, could be conservative and constructive in its approach to policies, in a democracy, another party may emerge that promised populism - that we have got so much money, why don't we give free medical care for people beyond a certain age, why can't we subsidise things more heavily and win elections? Of course, in this case they will spend the money, then the country would be weakened once the reserves are gone.
"So we introduced the concept of an elected President with power limited to two areas: one is on the use of reserves and the other one is the appointment of senior people in the civil service. In other words, a second key: the government can propose but the President must unlock it. As a result of this introduction of elected Presidency, you find that political parties cannot promise (populist policies). If they do, then we would ask: how do you intend to pay for this. You can't use the reserves to pay for your policies. So we have taken populism out of our democratic contest but other countries find that they are owing big sums of money, (because they) just spend and spend. It's not my problem, my problem is just to spend and make (promises)."
On the economic challenge to other countries from China's slow down
ESM Goh: "China is indeed slowing down. There are structural problems which they got to fix. There's an over-capacity in manufacturing, its population is also aging and the wages have gone up. China is therefore in a phase where it's got to restructure its economy. Will there be a hard landing for China? I don't believe so and I think the IMF (International Monetary Fund) doesn't believe China will just crash into the ground. (There are) huge problems but they are finding ways to move forward. And it's not just China but many economies will have to restructure themselves. Japan too is also facing the same problem. But China's growth rate affects all of us now. If China grows slower, I think our whole growth will slow down.
"What is the solution? We depend on China but we can on our own try to restructure our economy, find new areas of economic activity. Again we know what we should do, but how to do it is not that easy. In the Republic of Korea, they use the term creative economy. In other words, you can't just use conventional ways to grow the Korean economy, you got to create.
"In Singapore, we use the term knowledge economy and we got to increase our productivity, we got to restructure. In Japan, they use Abenomics to restructure. While China has a big influence on us, we must not depend on China alone. We got to restructure our own economy in order to grow.
"India, I think, is a hope for us. India is at the stage where China was 20 years ago, with tremendous slack in the economy. While China slows down, India should take the advantage and grow its economy by 8, 9 per cent and be the new engine for the world economy. In other words, don't just depend on China alone. I think all of us can play our part."