SINGAPORE (Rahnuma) : Singapore is not an appropriate model for the UK as it seeks to find a post-Brexit economic path, according to the prime minister of the Southeast Asian island state.
Lee Hsien Loong told the Bloomberg New Economy Forum that Britain “would have to find a different way to prosper having made the decision to leave the European Union.” Some UK politicians have argued that a Singapore-type model — a small trading hub unaligned to major power blocs — would be a possible economic template for the UK, which voted two years ago to leave the EU and is currently negotiating the terms of its exit.
“Maybe if you look at Singapore, you might think you have some ideas that you can use, we hope so. But I don’t think you can take one society’s solution and just plonk it on a different society.”
Singapore left the Malaysian Federation soon after it got independence from the UK in the 1960s, but became a major trading and financial hub in Southeast Asia.
But such a role for Britain would require big sacrifices of the UK’s developed system of state benefit, Long argued.
“Britain has developed a system of state welfare, a government role where the state accounts for 45 percent of the gross domestic product. The Singapore government accounts for maybe 17 percent of the GDP. So to be like Singapore, are you going to give up two thirds of your government spending, state pensions and national health?” Loong asked.
Singapore has no immediate plans for a closer relationship with post-Brexit UK, he added.
Global trading relationships have been the main theme of the two-day forum. Hank Paulson, former US treasury secretary and one of the co-chairs of the event, said that there was the risk of an: “economic iron curtain” coming between the US and China if they could not find a way to resolve their economic differences, which have threatened to erupt into a full-blown trade war over US imports from the Asian economic giant.
“The prospect of an economic iron curtain that throws up new walls on each side and unmakes the global economy, as we have known it, is very real,” Paulson told the forum.
Pauson said that President Trump should consider rejoining the Trans Pacific Partrnership, the trading alliance from which he withdrew soon after entering the White House, in order to influence Beijing economic policy.
Even if the US and China reached a deal on the commercial dispute between them, there was still the risk of a major confrontation between them due to differing geo-strategic interests, he said.
But he added that China was not a real enemy of the US. “China does not pose an existential threat to American civilization,” he said.