Chinese President Xi Jinping's visit 'may advance cooperation', says Singapore envoy

Xi Jinping with Prime Minister Lee Hsien Loong at a meeting at the Shangri-La Hotel on Nov 15, 2010.
Xi Jinping with Prime Minister Lee Hsien Loong at a meeting at the Shangri-La Hotel on Nov 15, 2010.PHOTO: ST FILE

It also signals mutual desire to build on 25 years of diplomatic ties, says S'pore envoy

An upgrade of the China-Singapore Free Trade Agreement (CSFTA) and progress on a third government-led project are two potential outcomes from Chinese President Xi Jinping's state visit to Singapore starting on Friday, said Mr Stanley Loh, Singapore's Ambassador to China.

But besides progress in cooperation, the significance of President Xi's two-day trip, which is part of an exchange of presidential visits to mark 25 years of diplomatic relations, also lies in the political signalling by both sides, added Mr Loh.

He said China extended a warm welcome to President Tony Tan Keng Yam on his state visit to China at the end of June, and Singapore is keen to reciprocate with "an equally if not even warmer welcome" to the Chinese leader.

 
 

"Given the deep and broad relationship between the two countries, it is important for us to have high-level mutual understanding and communication so that it permeates all the way down," he said.

"It sends an important signal of our mutual desire to build on what we've achieved in 25 years and raise it to a higher level and set a direction of where we want to go for the next 25 years and beyond."

Mr Loh, who took up his post in March 2012, was speaking to The Straits Times in a recent interview about Mr Xi's visit, which also touched on developments in bilateral ties and cooperation, and the opportunities and challenges ahead.

Mr Xi's visit this week would be his seventh - he was vice-president when he visited Singapore in 2010 to mark 20 years of diplomatic ties - and is "quite a large number for a top Chinese leader", said Mr Loh.

On the FTA upgrade, he said it could reap benefits for not only both sides, but also the region.

He noted that the FTA has been "immensely successful", judging from trade and investment relations - China is now Singapore's largest trading partner and Singapore has been its largest investor since 2013.

The FTA has also served as "a test pilot" for China, which is negotiating more bilateral FTAs.

"So we want to make sure that our agreement keeps pace with other agreements," he said.

During Dr Tan's China visit, the two presidents agreed to "positively work" towards an FTA upgrade that is "substantive, mutually beneficial, and with a level of ambition befitting our special relationship".

Both sides have since launched a scoping study on the CSFTA, which took effect in January 2009 and was the first China signed with another Asian country. The launch of formal negotiations could be a likely outcome from Mr Xi's visit.

For Singapore, it would create more opportunities for its investors - through greater market access and investment protection, among others - and also more job opportunities for Singaporeans in China, said Mr Loh.

For China, an FTA upgrade, which will focus more on investments and services, would meet its desire to attract foreign investors in the service sector, he said.

Some of the regional arrangements now in the pipeline include the China-Asean FTA and the Regional Comprehensive Economic Partnership, which involves the 10-member Asean group and its six dialogue partners, including China.

"There's also a signalling effect to all other investors, and not just from Singapore, about China's commitment to reform and to upgrade its economy," he added.

Also, he said, China is still grappling with bigger, regional free trade arrangements despite gaining confidence since inking the CSFTA.

"So Singapore can once again be an interesting and useful test pilot for China and a stepping stone as it prepares for some of these arrangements in the future," said Mr Loh.

Some of the regional arrangements now in the pipeline include the China-Asean FTA and the Regional Comprehensive Economic Partnership, which involves the 10-member Asean group and its six dialogue partners, including China.

Regarding the third proposed government-led project, first broached by China in 2013 to help boost its less developed western region, Chongqing is likely to be announced as the site of the new venture, beating Chengdu and Xi'an.

Unlike the first two government- led projects, Suzhou Industrial Park and Tianjin Eco-City, which began in 1994 and 2008 respectively, the third one will not be confined to one city, given its theme of modern connectivity and modern services. It also has to fulfil three criteria: suit China's developmental needs, break new ground and be commercially viable.

Location is but one of several factors being weighed by both sides, said Mr Loh. Another is room for policy innovation that can spur development in the western region.

"In a way, it should also be used as a test pilot and demonstrative area, because if it's something that the private sector can do entirely on their own, then they should do it. So there must be ingredients for the government to get involved," he added.

A version of this article appeared in the print edition of The Straits Times on November 03, 2015, with the headline 'Xi's S'pore visit 'may advance cooperation''. Print Edition | Subscribe