Rising protectionism in the West 'a threat to E. Asia's prosperity'

On the panel at the Credit Suisse 2017 Global Megatrends Conference were (from left): Mr Lito Camacho, vice-chairman, Asia-Pacific, Credit Suisse; Professor Tommy Koh, Singapore's Ambassador- at-Large; Sir John Major, former British Prime Minister; a
On the panel at the Credit Suisse 2017 Global Megatrends Conference were (from left): Mr Lito Camacho, vice-chairman, Asia-Pacific, Credit Suisse; Professor Tommy Koh, Singapore's Ambassador- at-Large; Sir John Major, former British Prime Minister; and Dr David Mulford, Distinguished Visiting Fellow at the Hoover Institution, Stanford University.PHOTO: CREDIT SUISSE

Experts discuss 'angry societies' and geopolitical trends that are set to shape the world economy for decades

Rising protectionist and nationalist sentiment in the West is a threat to East Asia's prosperity, said Singapore's Ambassador-at-Large Tommy Koh yesterday.

Asia has benefited significantly from free trade and an open global economy in recent decades, but "this liberal world order seems to be in jeopardy", added Prof Koh.

He was speaking on a panel including former British Prime Minister John Major and former US ambassador to India David Mulford, at the Credit Suisse 2017 Global Megatrends Conference. More than 500 people attended the event, held here for the fifth time.

Prof Koh and fellow panellists discussed the impact of "angry societies" and disenfranchised voters, which has led to unforeseen upheavals, like the divisive US presidential election and Britain's vote to leave the European Union (EU).

"(In Asia), we're opening up economies, liberalising, integrating with one another. The trend in America and beyond is a worry because it's going the other way," said Prof Koh, citing Mr Donald Trump's withdrawal of the US from the Trans-Pacific Partnership.

Dr Mulford agreed but noted the US "has from its birth been a free trader, a nation of competitors".

"We've gone through periods where protectionism has raised its head, albeit unsuccessfully... Because Americans like to compete, they like cheap, well-made goods.''

Sir John Major also cited US-China relations as a major geopolitical trend set to shape the world economy for decades. Their ties have evolved from tense standoffs to a complex mix of growing rivalry and rising interdependence.

While the two global superpowers have a very competitive relationship, ties are markedly less frosty - and dangerous - than US-Soviet relations were in the Cold War. This is an encouraging sign the world economy is on track to building stronger institutions that will benefit all nations, Sir John noted.

Prof Koh agreed US-China ties are symbiotic but warned mounting tensions could one day still mean a full-blown confrontation.

"We cannot be complacent about avoiding war between China and the US... (We hope) that statesmanship in Washington and Beijing will ensure that conflicts are managed, and areas of convergence expanded while areas of divergence minimised," he added.

Sir John said Brexit will contribute to mounting challenges in Europe, including the rise of populist sentiment. Brexit was a "historic mistake" that will weaken both sides economically and politically.

Sir John also outlined the harsh realities of the complex negotiations ahead - with the outcomes less than certain.

But ultimately, Britain and the EU will have to keep engaging, regardless of what comes after Brexit. "Whether this gamble was wise or foolish, only time will tell."

A version of this article appeared in the print edition of The Straits Times on April 21, 2017, with the headline 'Rising protectionism in the West 'a threat to E. Asia's prosperity''. Print Edition | Subscribe