We have to work to make trade a win-win: SM Lee in Guangxi

NANNING – While trade is no longer always seen as a mutually beneficial exercise in today’s unsettled and troubled world, countries have to work to make it a “win-win”, said Senior Minister Lee Hsien Loong on May 19 during a visit to Guangxi autonomous region in south-western China.

In a meeting with Guangxi’s party secretary Chen Gang in the capital, Nanning, SM Lee noted that trade has become mixed up with considerations about security, resilience and rivalry, as well as worries about vulnerability.

“If we are honest, we have to say that it is not always win-win, but we have to work to make it win-win,” he said, highlighting the considerable potential for economic cooperation in trade, investment and many other areas between Singapore and China, and between China and the wider ASEAN region.

“We would like to build on what we have done, to do more of this, and to enhance not just the economic well-being of our countries, but also the human well-being of our populations. Because, ultimately, the purpose of trade economics is to make the lives of our people better.”

Guangxi, which has an ethnically diverse population of more than 50 million people, acts as a gateway to western China, with its direct access to the sea via the Gulf of Tonkin.

Also known in China as Beibu Gulf, the waterway off the coast of northern Vietnam connects provinces like Yunnan, Guizhou and Sichuan with South-east Asia.

In his meeting on May 19, SM Lee pointed to the New International Land-Sea Trade Corridor (ILSTC) as one example of how commerce has resulted in mutual benefit.

The trade corridor, which allows goods to be moved from western China to ASEAN by road, rail, sea and, soon, river, is part of a wider bilateral connectivity initiative centred around Chongqing that SM Lee had a hand in starting when he was prime minister in 2015.

“It is not often that in politics you start something and you can see it end because projects take many years to come to fruition,” SM Lee said. “But here, in international relations, we have been able to make this happen, and I think it is a very good foundation on which we can do a lot more, as two peoples and two countries.”

Guangxi’s Mr Chen, who stepped into his current role in late 2024, was effusive about the region’s prospects for future development, lauding SM Lee’s contributions towards this.

As a relatively underdeveloped region of China, Guangxi hopes to strengthen cooperation with Singapore in the fields of port construction, logistics and shipping, Mr Chen said, noting that the Republic has also set an example for many developing countries in other areas, such as finance and services.

“As the capabilities of the (ILSTC) are further strengthened, and with the opening of the Pinglu Canal, I believe our role in leveraging this maritime route with ASEAN, especially Singapore, will become increasingly prominent,” Mr Chen added.

When completed in September 2026, the 134.2km Pinglu Canal in Guangxi will connect some of China’s inland rivers with the South China Sea, cutting shipping time and costs for goods that are transported between China’s inner reaches and South-east Asia.

Before he met Mr Chen on May 19, SM Lee toured the China-Singapore Nanning International Logistics Park, which was established in 2018 to serve as a key node along the ILSTC passage, with a total planned investment of more than 10 billion yuan (S$1.88 billion) from Singapore shipping company Pacific International Lines (PIL) and local partners.

Envisioned to be a one-stop shop for warehousing, logistics, trading, manufacturing and other operations, the 260ha park has been hailed as a flagship project for China-Singapore cooperation and is one of Guangxi’s major projects under China’s Belt and Road Initiative, a massive infrastructure strategy by Beijing to link Asia with Europe, Africa and Latin America.

Some of China’s top logistics players, such as SF Express and J&T Express, have operations there today. The park also houses a mercantile exchange showcasing more than 5,500 speciality products from 18 countries and a fruit exchange centre is being built to tap Guangxi’s status as China’s largest fruit producer.

Mr Teo Siong Seng, chairman of the logistics park and executive chairman of PIL, told Singapore media that he sees room for further trade between China and South-east Asia, especially for small and medium-sized enterprises.

He noted that Asean remains the most preferred and stable trading partner despite the current challenging geopolitical situation, and that China also sees Asean as one of its main growth areas.

Looking farther afield, Guangxi could also serve as an alternative connector with Central Asia, Mr Teo said, given that cargo shipments between Central Asia and South-east Asia mostly move through the Middle East, which has recently been embroiled in conflict.

He hopes SM Lee’s visit can raise awareness among Singapore and Asean businesses of the investment opportunities in Guangxi.

“This is maybe a place where it’s not as competitive compared to Shanghai and Guangzhou… The return is slow but in the long term, we believe it will pay off,” he said.

After leaving Nanning, SM Lee will travel to Shanghai, where he will speak at the closed-door J.P. Morgan Global China Summit and meet the city’s mayor, Mr Gong Zheng.