Business

Sino-Singapore Relationships: Deepening Business Ties But Worsening Diplomatic Relations?

By admin

March 20, 2017

While China has been Singapore’s top trading partner, Singapore has been China’s top foreign investor.

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During the Mao era (between 1949 and 1976), ties between China and Singapore were rather detached. According to Pei Shing Huei, former China bureau chief of The Straits Times, this is in part due to Mao Zedong’s desire as the leader of China to increase the loyalty of overseas Chinese to China. As such, an independent Singapore was not recognised during the Mao era.

However, when Deng Xiaoping stepped up to helm the economic and governmental reform of the People’s Republic of China after the passing of Mao Zedong,  his visit to Singapore and then-prime minister Lee Kuan Yew became emblematic of the camaraderie to come.

Just as quickly as China developed, diplomatic relations between the two nations—now well into a quarter of a century—grew and strengthened.  

Deepening Business Ties

Singapore and China have been deepening business cooperations, recently launching two new projects to expand Chongqing’s transport links to Southeast Asia and Central Asia, as well as signing five other pacts to cooperate on improving the infrastructure and services in Tianjin Eco-City (TEC).

While China has been Singapore’s top trading partner, Singapore has been China’s top foreign investor.  China’s rise brings about huge business opportunities that currently seem to be on the right track; but, like every other relationship, the Sino-Singapore one isn’t without its ups and downs.  

Worsening Diplomatic Relations?

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Are diplomatic relations between China and Singapore taking a turn for the worse?

It’s a question worth asking when we take into consideration the few signs of increasing friction between the two nations. For example, last year, the unique Joint Council for Bilateral Cooperation between China and Singapore did not transpire for the first time since 2004.

There are reasons to suspect that the South China Sea disputes, as well as the seizure of Singapore Armed Forces’ Terrex infantry carrier vehicles in Hong Kong, may have played a part in spurring the tension. Although Singapore is not a territorial state, it pushes for freedom of navigation in the waters—a stance that Beijing probably frowns upon.

There’s also the precarious juggling of relations between China and the United States. They may share a strategic partnership, but Singapore has been stuck between since as far back as 1990. While Singapore considers China its top trading partner, it also considers itself a strong supporter of the United States’ military presence in the Asia-Pacific region.

Moreover, Sino-American strains seem to have been deteriorating ever since Trump’s election and inauguration. Not only did he falsely accuse China of fabricating global warming, he also said that the United States did not necessarily have to stick to its long-standing position that Taiwan is part of “one China”, after accepting a congratulatory call from Taiwan’s president, Tsai Ing-wen. The irreverence of Trump has likely crossed China, prompting many news media outlets to prognosticate a potential trade war between the world’s largest economy and second largest economy.    

As Prime Minister Lee Hsien Loong put it in an interview with broadcaster BBC, “If America-China relations become very difficult, our position becomes tougher. Because then we will be coerced to choose between being friends with America, and friends with China.”

When it comes to managing politics, there is now a lot more at stake for Singapore to consider to ensure that bilateral, diplomatic relations with the Middle Kingdom are well-maintained.  

Friction Is A Norm

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“We share similar views on most issues and have worked well together to advance those common interests,” said Deputy Prime Minister Teo Chee Hean, in a recent email interview with Chinese news agency Xinhua. “But even among close neighbours and friends, there may be different perspectives on some issues, given that countries have different size, history, vulnerabilities and geographical location.”

Sure, there has been more friction between China and Singapore than usual, but that is inevitable given the two nations’ ultimate difference and the current uncertain global political and economic landscape.

Differences will definitely take time to resolve but they won’t be impossible to overcome. Plus, in light of the tentative first meeting between President Trump and President Xi JinPing set to take place next month, there is hope that peace will prevail and Singapore won’t find itself whirled up in a storm after the calm. ​