The enduring relationship between China and Singapore presents an opportunity for both countries to tackle together key problems of the future, including an ageing workforce and technological disruption.
In an address to 200 Chinese students at Tsinghua University yesterday, Finance Minister Heng Swee Keat described the fast greying populations, especially in Asia, as a critical issue, saying this would mean higher healthcare expenditures.
Slowing labour force growth would also mean a smaller pool of taxpayers supporting more elderly people, which in turn would affect the fiscal health of countries and impact growth. Technology, while presenting new opportunities, would also lead to some skills becoming redundant and jobs lost. Productivity was still growing, but at a slower rate.
Finally, income inequality and other fault lines had weakened social cohesion in many parts of the world, which has led to growing frustration with ruling elites, who have in turn made globalisation “an easy scapegoat”, said Mr Heng.
In a 35-minute speech at the university’s School of Economics and Management, he laid out three principles and five areas for closer Singapore-China cooperation to tackle problems likely to bedevil the global economy in the next decade.
The first principle is to move with the times and ensure cooperation stays relevant for both sides.
“As our countries progress, our cooperation will have to evolve to meet new needs and interests to remain relevant,” said Mr Heng.
The second is to collaborate through all-round partnerships and seek new frontiers. Mr Heng pointed out that the two economies are becoming more interconnected, while technological advances present new opportunities for teaming up. “We need to remain open to new ideas, and seek new areas of partnership,” he said.
The third principle is to build on each other’s strengths and form win-win partnerships. “By learning from one another, drawing on our respective strengths, we can achieve mutual benefits,” said Mr Heng. “In turn, we can build our ties in substantial and fruitful ways.”
He also listed the five areas of potential cooperation: trade, innovation, finance, people-to-people ties and environmental sustainability.
Mr Heng said that with the right policies, future challenges can be turned into opportunities for Singapore and China to achieve inclusive and sustainable growth. “The challenges which I’ve talked about are complex – and especially so for China, a nation of more than 1.3 billion. As tomorrow’s leaders in business and government, the future is in your hands,” he told the audience.
“Moving forward, there will be increasing cooperation at the government, business and people-to-people levels to meet evolving needs and form all-round, win-win partnerships.”
Mr Heng is on a five-day visit to China which started on Wednesday. He is accompanied by Senior Minister of State for Trade and Industry and National Development Koh Poh Koon, officials from the ministries of Finance, Education, and Trade and Industry, and IE Singapore.