33rd Asean Summit

Asean has to stay open to sustain its dynamism: PM Lee

Prime Minister Lee Hsien Loong with (from left) IMF chief Christine Lagarde, Canadian Prime Minister Justin Trudeau and Chilean President Sebastian Pinera before the leaders headed for a working lunch yesterday.
Prime Minister Lee Hsien Loong with (from left) IMF chief Christine Lagarde, Canadian Prime Minister Justin Trudeau and Chilean President Sebastian Pinera before the leaders headed for a working lunch yesterday.ST PHOTO: GAVIN FOO

Grouping a bright spot amid slowing world growth and rising protectionism

Asean remains a bright spot in the world economy at a time of slowing global growth and rising protectionism, but it has to stay open and connected to sustain its economic dynamism, Prime Minister Lee Hsien Loong said yesterday.

The grouping's members should also "safeguard the multilateral trading system as the basis of global commerce", he added.

He was speaking at a working lunch he hosted at the Asean Summit for Asean leaders and three guests - Canadian Prime Minister Justin Trudeau, Chilean President Sebastian Pinera and managing director of the International Monetary Fund (IMF) Christine Lagarde.

All three are strong advocates of multilateralism, PM Lee noted. Canada is current president of the Group of Seven (G-7) largest advanced economies, Chile is the incoming chairman of the Asia-Pacific Economic Cooperation (Apec) forum and an active member of the Pacific Alliance - a Latin American trade bloc - and the IMF provides a multilateral platform for its 189 members to work together.

PM Lee also noted that the world is becoming more interdependent and interconnected due to digital technologies and transboundary challenges like climate change and cyber security. "Yet, at the same time, we may become more divided and insular because of growing nativism and protectionism."

He noted that the World Trade Organisation (WTO) has revised its world merchandise trade growth forecast down, and the multilateral system that has underpinned global growth and stability is under stress.

"In the face of these trends, Asean has remained a bright spot. It is one of the most politically stable and economically vibrant regional groupings in the world," he said.

 
 
 

Four Asean members have also signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership alongside Canada, Chile and others, he noted. The pact enters into force next month.

Wrapping up the closed-door session later, PM Lee thanked his colleagues for their candid exchange of views. He noted that the IMF's latest forecast is that Asia will grow by 5.6 per cent this year, outstripping global growth of 3.7 per cent. And Asean's digital economy is projected to grow to US$200 billion (S$276 billion) by 2025.

"However, to sustain our economic dynamism, we need to remain open and connected, and safeguard the multilateral trading system as the basis of global commerce," PM Lee said.

"At the same time, we should consider seriously how to update the WTO system to address current economic realities, such as e-commerce and the rise of emerging economies. These reforms are necessary to keep the system relevant."

"I am glad that Asean is not alone in upholding a free, open and rules-based multilateral system," he said, adding that it values the continued support of its external partners. "We also look forward to your participation in key Asean initiatives such as the Asean Smart Cities Network, which will better prepare our cities and our peoples for the future."

A version of this article appeared in the print edition of The Straits Times on November 15, 2018, with the headline 'Asean has to stay open to sustain its dynamism: PM Lee'. Print Edition | Subscribe