World leaders must strengthen global trading system, get politics right: PM Lee Hsien Loong

Prime Minister Lee Hsien Loong (second row, first from right) and other world leaders at the G-20 Summit in Osaka, on June 28, 2019.
Prime Minister Lee Hsien Loong (second row, first from right) and other world leaders at the G-20 Summit in Osaka, on June 28, 2019.PHOTO: AFP

OSAKA - At a summit bogged down by simmering trade tensions, Singapore Prime Minister Lee Hsien Loong called on world leaders to strengthen the global trading system instead of diminishing its role, adding that a key part of doing so is getting their politics right.

This will help sustain policies that support global trade and investment, which in turn will benefit citizens, he said on the first day of the Group of 20 (G-20) Leaders' Summit in Osaka.

"Leaders need to explain the challenges and trade-offs clearly and honestly to voters, persuade them, and work together with them to promote their own long-term interests," he added.

PM Lee also said that the World Trade Organisation (WTO) must be brought up to date, and urged members to "work constructively and urgently undertake reform".

This includes quickly resolving the impasse over the organisation's appellate body, which hears appeals in trade disputes between countries, he said.

The United States, which is facing a barrage of disputes at the WTO, has repeatedly blocked the appointment of judges to the appellate body.

Two of its three remaining judges will step down in December, leaving the system paralysed if no new judges are appointed. At least three are required to hear a case.

 
 
 
 

While the existing multilateral trading system is imperfect, countries depend on it and the alternative would be much worse, PM Lee said. He noted that segments of the population in many countries feel that globalisation has worked against them, and are pushing back against it in a strong nativist reaction.

"But the solution is not to close up. Instead, we must raise the skills of our people to prepare them for new jobs, and help our businesses to adopt new technologies and to raise productivity," he said.

"We must get our politics right too, in order to sustain policies that support global trade and investment, and enable our peoples to benefit from them," he said.

PM Lee also spoke of developing new rules for the digital economy, commending Japan on its leadership in this area. He added that Singapore, Japan and Australia have worked together to convene the WTO Joint Statement on Electronic Commerce initiative, which aims to take the digital trade agenda forward.

He also noted that Singapore is working on a Digital Economy Partnership Agreement with Chile and New Zealand, which he hopes will become a useful model for other countries.

Warning that the consequences of turning away from globalisation will be dire, PM Lee said he looks forward to working with his counterparts on these important issues and injecting new momentum.

"If globalisation does not hold, the world economy will be divided into rival blocs, tensions and conflicts will sap our attention and resources, and we will all be poorer off and less secure."