World Economic Forum: Winning hearts and minds on the benefits of globalisation

Important to ensure system of open borders and free trade continues to work for everyone

For a small country like Singapore, being open and connected to the world is not exactly a matter of choice. With no resources, and neither land nor hinterland, it was always, to put it simply, a matter of do it, or die.

Most Singaporeans know this instinctively. But while the head might say this is so, the heart still needs to be won over.

Making the case for globalisation, at a time when it is under severe threat all round, is therefore critical to ensuring the system continues to work. As recent elections and events around the world have shown, political leaders - and societies - that failed to recognise this have paid a heavy price.

This was a point Prime Minister Lee Hsien Loong returned to in several discussions here in Davos, where business and government leaders are meeting at the annual World Economic Forum.

"We have to look after our own people, make sure that all these good things which happen in the world benefit not just Singapore, but benefit Singaporeans - across the board - so that they are able to take advantage of the jobs that we create, so that they are able to fend for themselves against global competition," he said.

"So that if one industry is declining, which will happen from time to time, the people there are given the help, the support and the time to gain new skills, and transfer their employment to another industry, another job and be able to make a living for themselves and not feel that they are fending for themselves on their own, that the system is not on their side."

In his wrap-up interview with the Singapore media yesterday, Mr Lee went on to add that it was important that people not only understood this in the abstract, but also sensed the benefits of economic openness in their daily experience. They also needed to be confident that their leaders had their interests at heart, and would look out for them, at a time of major economic change and transition.

He cited the example of a young Chinese entrepreneur he had met in Davos who had set up his tech company in Shenzhen, with 60 per cent of his employees being Chinese and the rest from abroad. But he was seeking to raise the proportion of talent from overseas to 80 per cent, in order to have the diversity of talent needed for his company to scale up and compete globally.

If this was the case in China, with 1.4 billion people to draw on, what more in Singapore, said Mr Lee, adding that attracting such companies to Singapore created good jobs for Singaporeans, even if some of their colleagues or bosses were from abroad.

Some opposition parties were trying to seize on unease about immigration on the ground and exploit it for electoral gain, he said, pointing to the Singapore Democratic Party and the Workers' Party, both of which have taken up the issue in recent statements.

"They think they see a divide there, and they want to make it wider and exploit it. And it is our job to make sure that we don't allow such a divide. And even if it is a weak point, it doesn't get exploited.


Prime Minister Lee Hsien Loong has said that Singapore has to look after its own people and make sure that all the good things happening in the world benefit not just Singapore, but also Singaporeans. ST PHOTO: CHONG JUN LIANG

"That is why I think it is important for us to explain to Singaporeans that we are doing this to make things work for Singaporeans. And this is the best strategy for Singapore to prosper."

A day earlier, speaking on a panel titled Leading A New Multilateralism, Mr Lee had cited globalisation as one of the key underpinnings of the Republic's success over the past 50 years, but also pointed to it as a risk to its future prospects should the system unravel in the face of populist pressures.

He said: "If 5½ million or six million people in Singapore have to grow our own food, and make our own computers, and make our own banking and living, I think we will starve, it is not possible.

 
 
 
 

"But to prosper in such a new globalised but troubled environment, we have to up our game, raise our capabilities, bring in new investments which will connect us to centres of vibrancy and prosperity all over the world."

Yet, making the political case for globalisation is as important as the rational economic arguments. Parties and political leaders everywhere have drawn the lessons from recent events, such as the British vote to leave the European Union, and the surprise election of United States President Donald Trump on a wave of support from disgruntled blue-collar workers.

Even last year's thumping victory by Britain's Conservative Party led by Prime Minister Boris Johnson has been attributed by some commentators to a sense among many working-and middle-class voters that he was more in sync with their concerns and aspirations than the Labour Party led by Mr Jeremy Corbyn.

Popular protests around the world, from France to Chile, have also broken out because workers there had begun to wonder if the global liberal economic order and their leadership elites who upheld it were acting in their interests when they pushed for free trade and open borders.

Taking up this point in a separate discussion later, Foreign Affairs magazine editor Gideon Rose noted that the critical factor that underpinned the globalised system was trust.

Voters needed to have trust in their leaders, and believe that they were defending their interests, for them to "buy into the project".

That project - the liberal global economic order - stemmed from a belief in the US after World War II that it was "part of an international team". It was in the US' own interest to shape the rules of the system such that all members of this team could rebuild and prosper together.

The America First approach now being pushed by Mr Trump has upended this, Mr Rose said, adding that it was critical to rebuild that trust, both within the US, and also among America's allies, so that they did not lose faith in the liberal economic order the US has fostered and which had brought so much prosperity to the world.

This polarising issue looks likely to be coming to a polling booth near you before long.

 

With a general election looming in Singapore - some think it could be held within months, even though it is not due till April next year - there are signs that this is shaping up to be a key point of political contestation.

So, as in several other recent elections, bread and butter issues such as jobs and the cost of living are likely to be on many voters' minds.

But much will also depend on how well political players on all sides are able to sway voters on the issue of whether the system of open borders and free trade that underpins globalisation really works for them.

For Singapore, which has just marked its bicentennial as a free trading post and thrived as a node for global trade over the decades, this is nothing less than an existential question.

A version of this article appeared in the print edition of The Straits Times on January 24, 2020, with the headline 'Winning hearts and minds on the benefits of globalisation'. Subscribe