Mr Barry Desker, 
Dean of the S. Rajaratnam School of International Studies of NTU,
Excellencies and distinguished guests, 
Ladies and gentlemen,

We live in an age of anxiety. Thirty years ago, no one could have predicted where we are today, and what we are going through now. In the 1980s, as the world's major powers embraced globalization, international trade and investments grew and living standards rose across the world. Later, the end of the Cold War seemed to augur a new era of global convergence. America was obviously the dominant global power, which added to the stability of the international system by discouraging challenges from other nations.

However, the economic crisis that struck the world in 2008 has changed the logic of international relations. The crisis has heightened awareness of American economic challenges and vulnerabilities. Meanwhile, the European Union is still grappling with its debt problems, which can turn into another full-blown financial crisis. The risks of failing states in other parts of the world, and conflicts breaking out in the Middle East, all carry dangerous consequences. In short, the new world we live in is now less stable, more volatile, with old ideas overthrown, and new powers on the rise, especially in this part of the world.

Asia in the 21st Century Security Environment

Much of the shift in the balance of geostrategic weight to Asia is due to the rapid emergence of China and India. The two Asian powers are growing faster than nearly any other major economy. At the same time, other Asian countries are taking off. Vietnam and Indonesia, for example, are powering ahead. In Myanmar, change is coming at a rapid pace, after years of deadlock and stagnation. Within a decade, economic and technological advances of the countries in Asia will surely alter the economic and strategic weights of the world's steering economies and bring about significant realignments in the region and beyond. We are living through a period of rapid shifts in the global balance, andthe big question is whether these changes will occur without disruptive conflicts.

The foundation for stability of the Asia-Pacific region and the world is ultimately sound and balanced relations between China and the US. Both sides have strong reasons to cooperate and manage the relationship for mutual advantage. China wants access to US markets and technology. Chinese leaders also recognise that the US will be a more powerful and advanced country than China for many decades to come. They see an overriding imperative to maintain internal stability and growth, and are unwilling to risk drastic policy changes which may dislocate the economy. America's interests lie in a stable China that will work with it on shared concerns like North Korea or nuclear non-proliferation. The Obama administration has made very clear that the US will be making a strategic "pivot" towards Asia, and that the reductions in US defence spending will not come at the expense of its presence in the Asia-Pacific. As President Obama puts it, the United States is a "Pacific power and [it is] here to stay".

So far, both Washington and Beijing have wisely embraced the concept of a "constructive partnership" in global affairs. But there are potential stress points, ranging from sensitive trade to security issues. Furthermore, both America and China will be undergoing leadership transitions later this year. This adds to the potential for Sino-US relations to be further complicated in the face of either domestic pressures or political posturing. The mood in America is defensive, partly because of its own domestic economic issues, but also due to growing discontent with globalisation, provoking nationalistic and protectionist sentiments. Even mainstream American economists are beginning to blame Chinese "mercantilism" for financial instability and job losses. In such an environment, it is easy for words or actions to inadvertently raise the temperature, and result in an unintended escalation of tensions between the two major powers, China and America. Asian countries will be forced to choose sides, which none want to do.

The challenge in Sino-US relations is therefore for both sides to perceive their strategic interests in a constructive and cooperative relationship, while managing the frictions and political pressures that will inevitably arise from time to time. If the US and China can accommodate each other on a broad range of issues, the prospects for stability in the Asia-Pacific will be greatly increased. A balanced and constructive Sino-US partnership will set the tone and parameter for long-term regional cooperation, and also provide the over-arching framework for the other key relationships in the region, whether between China, Japan, India, or the ASEAN member states.

Defence Spending in Asia

Defence spending in Asia has reflected this shift in the global balance of economic and strategic weight. As Asian countries continue to grow economically, they have also increased their defence spending. Between 2001 and 2010, military expenditure in Northeast Asia and Southeast Asia increased by 70%, and 60% respectively . This increase is to be expected, in some ways, as Asian countries become more affluent, but it is not without consequences. The increase in defence spending in Asia presents both opportunities as well as challenges.

On the positive side, as Asian militaries become more capable, they can do more to contribute to regional security and to tackle the myriad transnational security challenges confronting the region. As they become more professional, they are also likely to want to cooperate with other militaries on a professional basis, contributing to confidence building in the region. This is especially important given that the multi-dimensional and transnational nature of modern security challenges - terrorism, maritime security, natural disasters, climate change, and so on - precludes any single state from tackling such threats effectively on their own. We have seen many militaries deploying to provide assistance following natural disasters, for instance, and they have become more confident and comfortable working with one another as well as with civilian agencies. Militaries have also come together to conduct humanitarian assistance and disaster relief exercises, to better prepare for the next time they have to work together.

However, as militaries increase their capabilities, the potential for strategic miscalculations and misunderstandings amongst militaries and nations can also arise. This underscores the need for misunderstandings and potential tensions to be managed, and trust and confidence to be built continuously. Lingering flashpoints in the region include the territorial disputes that continue to complicate the strategic calculations of these Asia-Pacific governments, as well as the risks of a nuclearised Korean Peninsula. In dealing with these issues, governments will need to manage short-term populist sentiments within their own countries as well as the implications for longer-term regional peace and stability.

A Robust Regional Security Architecture

There are no easy solutions to the challenges of the 21st century security environment, which will continue to complicate the geopolitical landscape in the region for some time to come. The countries in the Asia-Pacific region have sought to manage these challenges through the building of a robust security architecture that is centred on ASEAN, but is yet open and inclusive. Such an architecture can help build confidence, reduce tensions, and entrench a spirit of constructive cooperation to maintain peace and stability in the region and beyond.

Over the years, various forums have emerged to facilitate dialogue and to enhance the awareness and appreciation of our shared interests. The Shangri-La Dialogue in Singapore is one example of a platform that allows the building of trust and confidence, and a shared understanding of challenges, by promoting the exchange of ideas on issues of common interest.

For example, at the Shangri-La Dialogue last year, one of the attendees was Chinese Defence Minister General Liang Guanglie. This was China's highest level of representation at the event. While in Singapore, he took the opportunity to hold a bilateral meeting with then-US Secretary of Defense Robert Gates, during which both concurred that Sino-US military ties were improving but required further strengthening. Secretary Gates himself had attended every Shangri-La Dialogue held during his tenure as Defense Secretary, which I believe is an indication of how useful the event is, and how useful he found the opportunity to meet with his counterparts in the region.

This Asia-Pacific Security Conference is another important platform where participants from around the world can gather together to address the security challenges facing our region, and to develop a deeper collective understanding of the modern geopolitical security environment. Such forums allow for the building of personal ties and goodwill, as well as the clarification of positions and discussion of sensitive issues. They form an integral part of the process of international dialogue.

At the same time, it is equally important that the region should move beyond dialogue to tangible defence cooperation. Defence establishments in our region have long recognised the need for concrete and practical activities in defence cooperation. As the various military officers in this audience will know, it is only through exercising and working together that confidence and trust is built, and indeed strong relations forged. Hence, regional militaries have been exercising and cooperating together under the ambit of platforms such as the Five Power Defence Arrangements and the Western Pacific Naval Symposium for many years. In fact, the Five Power Defence Arrangements, or FPDA, recently celebrated its 40th anniversary, during which the major FPDA exercise Bersama Lima was held. The exercise involved some 4000 personnel, 67 aircraft, 18 ships, two submarines and various support elements from the FPDA member-countries. This is indicative of the strong commitment by member countries to the FPDA, which has evolved over the years to ensure that it remains relevant to the changing security landscape.

Like the modern security environment, the regional security architecture is far from static. Newer initiatives also exemplify how defence establishments have come together to manage modern threats with modern methods, while enhancing mutual coordination and confidence. Examples include initiatives such as the Malacca Strait Patrols, with its "Eyes-in-the-Sky" combined air patrols, as well as broader mechanisms to promote information-sharing among like-minded countries, such as the Singapore Navy's Information Fusion Centre, or IFC. The IFC currently facilitates regular information exchanges with 46 operations centres and agencies across 29 countries. Since its establishment, some 30 International Liaison Officers from 12 countries, ranging from France to Vietnam to New Zealand, have been attached at the IFC. These Liason Officers work together to fuse, analyse and disseminate maritime information, which allows for the early detection of potential maritime threats and the development of timely and effective responses.

More recently, the ASEAN Defence Ministers' Meeting-Plus, or ADMM-Plus, which brings together the ten ASEAN countries and eight "Plus" extra-regional countries, has emerged as a valuable platform that combines both elements of dialogue and practical cooperation. Although the ADMM-Plus was only inaugurated in October 2010, the ADMM-Plus militaries have already demonstrated a strong appetite for practical cooperation through the ADMM-Plus Experts' Working Groups, or EWGs. The five EWGs tackle various modern security challenges that affect all member-nations, such as maritime security, counter-terrorism, military medicine, peacekeeping operations and humanitarian assistance and disaster relief. The five EWGs have all held their first meeting. There has been strong support for these EWGs, which have made concrete plans for practical cooperation such as joint exercises and information sharing possible.

These developments are positive and they are encouraging signs of the region's adaptability to the changing geopolitical landscape, and its commitment to pursuing concrete cooperative activities to deal with the security challenges confronting us all. But the continued commitment of countries and militaries in this endeavour remains critical.

Conclusion

To conclude, let me just say that the Asia-Pacific is the world's fastest-growing region and home to more than half the global economy. These are facts that we all realize and recognise. What happens in this region will largely define whether the century ahead will be marked by conflict or cooperation, by needless suffering or human progress. We must work together across countries and across continents to reach a consensus on the big issues, and make our interdependence work for the benefit of all. This is the basis for our shared security and common well being in the evolving geo-political landscape of the Asia-Pacific. Thank you very much.