Countries should work together to update World Trade Organisation (WTO) rules to deal with new issues such as the emerging digital economy, said Trade and Industry Minister Chan Chun Sing yesterday.
Mr Chan told an investment forum on the Belt and Road Initiative that the multilateral trading system - on which global trade and investment takes place - must evolve with the times.
He noted that China has shifted from attracting foreign direct investment to increasingly having the ability to export its capital and expertise to the rest of the world.
"Some international media have expressed concerns with this development," Mr Chan said, adding that others have questioned the intent and financial viability of various projects in the Belt and Road Initiative, China's multibillion-dollar plan to connect Asia, Africa and Europe.
"In the global context, we have also seen the rise of anti-globalisation sentiments and the escalation of trade tensions," he said. "As we mark the fifth year of the Belt and Road Initiative, it is important that we address some of these challenges constructively together and realise its full potential."
He noted four principles that can help ensure a stable business environment.
The first is strengthening the multilateral system and WTO rules. There is also a need to allow market discipline to run its course, meaning projects must be evaluated according to market principles. Projects held to high standards of financial prudence, Mr Chan noted, also inspire confidence and bring real benefits to the public.
The third principle is to continue working hard to integrate production and value chains.
"Protectionism will result in the fragmentation and isolation of production and value chains," he said.
He added that in working towards a more interdependent system, countries must also distribute the gains from globalisation across their respective societies to help those who have fallen behind - or risk local backlash, with global consequences.
He also said projects must benefit an expanding circle of stakeholders, from local communities to the region and the world. This gives stakeholders a "vested interest and responsibility in the projects' successes".
Mr Chan told yesterday's gathering at The Ritz-Carlton, Millenia Singapore ways in which Singapore can play a part in the Belt and Road Initiative as a global trading and financing hub. It can be "a pathfinder for new ideas", he said, citing a connectivity initiative in Chongqing which re-imagines existing trade flows.
Singapore can also serve as a launch pad for Chinese firms that want to venture into third-party markets, especially those in South-east Asia. At the same time, it can offer expertise in financing and legal advisory services and enhance the sustainability of projects under the initiative.
"The success of the Belt and Road Initiative will depend on how we, as partners and stakeholders, work together to shape this initiative going forward," he said.