Speech by Minister for Defence Dr Ng Eng Hen, at the Center for Strategic and International Studies, on 13 Dec 2013 (US Time)

THE RISE OF ASIA - REAPING PROMISES, AVOIDING PERILS

I would like to thank Mr Richard Armitage for his kind introduction and Mr Michael Green and the Center for Strategic and International Studies for hosting this session. I am glad to have this opportunity to be in Washington D.C. again to meet with close friends, and to be able to exchange views with such an informed audience assembled here.

I bring you warm greetings from Singapore. President Barack Obama characterises the relationship between our two countries as an "extraordinary relationship". Indeed, Singapore and the US are strategic partners and share a vision for a world that gives every person of any creed, colour or background an equal opportunity to fulfil his or her aspirations and succeed.

Defence and security agreements form one of the solid pillars in this extraordinary relationship. Before I arrived in Washington, I was in Luke Air Force Base in Arizona after witnessing the Singapore Armed Forces' Exercise Forging Sabre, an exercise that involves all four of our Air Force training detachments in the US as well as our Army's High Mobility Artillery Rocket System (HIMARS) detachment. We celebrated the 20th anniversary of our Peace Carvin II F-16 detachment, which is testament to the long-standing relationship between the US and Singapore.

This close relationship with the US is based on shared strategic perspectives for a stable Asia-Pacific region that fosters growth and prosperity for all nations, small and large. These beliefs underpinned the 1990 Memorandum of Understanding (MOU) between the US and Singapore for US ships and planes to transit through our air and naval bases, occurring at the time the US lost its access to its Philippine bases. This 1990 MOU was signed by our founding Prime Minister Mr Lee Kuan Yew and then-US Vice President Dan Quayle. Mr Lee Kuan Yew explained the reasons for the MOU in an interview in 1991: "the American presence, in my view, is essential for the continuation of international law and order in East Asia An Asia in which cooperation and competition increases everyone's well-being, peacefully and without recourse to arms, has been the norm. This kind of Asia, this kind of Pacific, cannot exist without America being a major economic and security presence." In 2005, Singapore reaffirmed this belief through the Strategic Framework Agreement (SFA), signed between then-US President George W. Bush and current Prime Minister Lee Hsien Loong. Ensuing from the SFA, US Secretary of Defense Chuck Hagel and I were pleased to note that the first Littoral Combat Ship (LCS), the USS Freedom, was deployed to Singapore this year, taking part in bilateral and multilateral exercises and enhancing the US' engagement with our region. We look forward to the deployment of the next LCS next year.

In the last 50 years, the US' presence in the Asia-Pacific region has been a force for stability and progress. The US' leadership in global finance and trade, intellectual property protection, science and technology has also promoted the growth of emerging economies, which allowed Asia to prosper.

Promises to Reap

But even the architects and visionaries that foresaw Asia as a thriving member of the global community - the US among them - would have been astounded by Asia's rise and position today. The historical context that preceded Asia's rise bears re-visiting because we can't forget how difficult it was.

Following the devastation of World War II, Japan and South Korea needed to be rebuilt. In the aftermath, General Douglas MacArthur and his team drafted a constitution that set Japan on a path away from "belligerency", with the Japanese Armed Forces replaced with the Self Defense Forces. For Southeast Asia, the tide of independence would take almost 40 years, but eventually freed all states from their colonial masters - starting with Vietnam and Indonesia's proclamations of independence in 1945 and culminating in Brunei's independence in 1984. Singapore too is still a relatively young nation of 48 years, independent since 1965.

From the 1950s to the 1970s, these fledgling Southeast Asian nations and Korea were caught up in the fight against Communism. In former US President John F. Kennedy's words, "to those new states whom we welcome to the ranks of the free, we pledge our word that one form of colonial control shall not have passed away merely to be replaced by a far more iron tyranny". It was a very difficult and painful period for Southeast Asian nations, especially for Vietnam, Laos and Cambodia, who became what academics dubbed as the playground for proxy wars. Although decades have passed, historical echoes still resonate today. When General Vo Nguyen Giap died in October this year, I paid respects on behalf of Singapore in the quiet and dignified surroundings of the Vietnamese Embassy in Singapore. But in Vietnam, tens of thousands poured out onto the streets to pay their last respects and mourn the passing of a war hero. We are still dealing with the legacies of that period. Recently, the ASEAN Defence Ministers' Meeting (ADMM)-Plus formed an Experts' Working Group to address unexploded ordinances in affected countries through de-mining.

The experience of being colonised and caught between global powers galvanised Southeast Asian states to consolidate and protect their sovereignty, to be able to chart their own paths and future. To this end, ASEAN was formed in 1967, with five founding members, Indonesia, Malaysia, Philippines, Singapore and Thailand, specifically to "bind the Southeast Asian nations together in friendship and cooperation, and through joint efforts and sacrifices, secure for their peoples and for posterity the blessings of peace, freedom and prosperity". Brunei became the sixth member in 1984, one week after achieving independence. ASEAN has now expanded to ten member states, as from 1995 to 1999, Vietnam, Myanmar, Laos and Cambodia all joined in rapid succession.

Today, the growth that China, Japan, the Republic of Korea and the ASEAN member states have experienced has surpassed expectations. Globally, a free-market economic system has been entrenched. The Bamboo Curtain parted in 1982, and economic reforms began in earnest when Deng Xiaoping declared that China would build "socialism with Chinese characteristics". It would take another 25 years for this irreversible change to be institutionalised as the National People's Congress, China's national legislature, officially adopted a property rights law that also protected the property rights of individuals in 2007.

The entry of the world's most populous nation into the capitalist economy, fuelled by China's science and technology capabilities and entrepreneurial energy, would fundamentally alter China itself and the world with it. Today, there are already over 150 billionaires in China, more than any other nation except the US. China's GDP has also risen from approximately US$300 billion in 1980 to US$8,200 billion in 2012. This growth is virtuous. Some 680 million people were lifted above the poverty line by some estimates, in 2030, there will be approximately 1.4 billion middle class consumers in China, four times as many as that in the US and three times that of that in Western Europe.

The world needs China, as well as the US, as its growth engines. China now accounts for about 10.45% of global trade in goods - the same as the US' share According to the World Bank, China's share will increase to 15% in the next decade. China's growth is sustainable because it is propelled by the "animal spirits" carrying the forces of innovation through science and technology.

ASEAN too has progressed rapidly. Our combined population of 616 million people with a combined GDP of around US$2.3 trillion in 2012, larger than India's US$1.8 trillion. Our GDP for ASEAN is expected to double by 2020.

Overall, I think that we can celebrate Asia's rise. It is what enlightened powers have collectively worked for, even fought and died for, in the last half century. Without Asia's economic input today, the effects of the global financial crisis in 2008 would have been much more severe. Our future also depends on a strong Asia. According to the World Bank, East Asia and the Pacific will contribute 40% of global growth and one-third of global trade this year, higher than any other region in the world.

Perils to Avoid

Even as we celebrate Asia's prosperity, there are perils to avoid. While the economic progress of Asian countries has been stellar, the political systems and national institutions in each country are still evolving. This duality is inherent as political and economic reforms within countries often move at different speeds.

The leaders of ASEAN have resolved to achieve an ASEAN Community by 2015. But ASEAN member states are far apart in terms of economic development and the socio-cultural influences that shaped them. For instance, per capita GDP of the ASEAN members range from US$890 in Myanmar to over US$50,000 in Singapore. The present day systems of governance are influenced by different colonial pasts - the French in Vietnam, Laos and Cambodia; Singapore and Malaysia by the British; Indonesia by the Dutch; Spanish and American for the Philippines. The religious influences within each ASEAN member state differ widely too. For example, the majority in Cambodia, Laos, Myanmar and Thailand are Buddhists; while Muslims predominate in Brunei, Indonesia and Malaysia, and the Philippines is a Catholic-majority state.

ASEAN's socio-political landscape is a kaleidoscope of different societal DNA and governance systems. These differences set the pace and direction of political, social and economic reforms in each country. The risks of instability exist in these processes. While Myanmar has started an unprecedented simultaneous political and economic opening up of its society, it also has to deal with clashes between different ethnic and religious groups. Indonesia needs to ensure that its structural economic reforms begun apace. Thailand is struggling with ongoing political turmoil, with many changes of government in the last decade of confrontation between the Yellow and Red-shirt supporters. Beyond ASEAN, China is undergoing deep economic and social reform as articulated during the Third Plenum. Japanese Prime Minister Shinzo Abe declared that his obligation is "first of all, to rebuild the Japanese economy to be vibrant, and then to make Japan a dependable 'force'", but has to contend with reactions from Japan's neighbours due to unresolved animosities of the past.

Political challenges that are common to all countries will also add pressure to incumbent governments. Around the world, a growing middle class and a younger generation with rising aspirations will exercise greater political voice and exert influence, facilitated by the internet, whether it is the "Occupy Wall Street" movement in the US or the strikes for a higher minimum wage hike in Indonesia.

Asian nations have also witnessed an increase in nationalism amongst their people. As countries develop, it is natural and proper for governments and citizens to feel a sense of pride and assert their national identity and sovereignty. This is a legitimate right. However, unabated and unaccommodating, this assertiveness can accentuate tensions and even precipitate conflicts. In the East China Sea, strong nationalist sentiments have been roused in both China and Japan over the Diaoyu / Senkaku Islands. Tit-for-tat deployments of patrols and naval vessels of both countries have occurred. Fighter jets have been scrambled to respond to aircraft overflights, and there have even been allegations of a fire-control radar locked on a country's destroyer. Strong reactions have also occurred in response to the recent Air Defence Identification Zone designated by China. While no physical incidents have occurred as yet, the risks are not theoretical. In another incident in May 2013, a Taiwanese fisherman was shot and killed by the Philippine Coast Guard in the South China Sea.

On the Korean Peninsula, North Korea ratcheted up the rhetoric and threatened at one point to void the armistice that ended the Korean War and launch a nuclear attack on the US. All of us watch these unfolding and escalatory events with concern. Indeed, we should, as these security challenges and flashpoints could derail the stability and growth of Asia.

Facilitating Promises and Avoiding Perils

While the world reaps the harvests of Asia's economic rise, we must pay heed lest Asia stumbles, as the impact on the world will be deeply felt. Collectively, we must do all we can to continue to provide and create conducive conditions for Asia's virtuous growth to continue. There is much we can do, anchored on dialogue, cooperation and shared beliefs.

As a start, we must deepen economic ties by enhancing the flow of trade and investment. As PM Lee said during his visit to the US in Apr 2013, "in Asia, trade is strategy", and he urged the US to "push the Trans-Pacific Partnership energetically" to further liberalise trade across the Pacific. The Regional Comprehensive Economic Partnership between ASEAN and its Free Trade Agreement partners, is another such initiative that expands trade.

In the social-cultural domain, we should increase people-to-people and institutional exchanges to foster understanding and forge ties from the ground up.

Strengthen Platforms for Dialogue and Co-operation

We must step up efforts in the area of defence and security. Military spending in Asia has gone up significantly and will continue to rise. According to the International Institute of Strategic Studies (IISS), Asia's nominal military expenditure in 2012 was US$287 billion, it surpassed Europe's military spending of US$262 billion. The convergence began accelerating after the 2008 financial crisis, as NATO European defence spending declined by an average of about 4% per annum in the past four years even as Asia's military expenditures increased about 9% annual growth. As Asia's militaries modernise, we must ensure constant dialogue and cooperation between all countries to avoid misunderstanding and reduce tensions. There must be responsive and effective dispute resolution mechanisms to address differences through peaceful means. Here, the ADMM-Plus has entrenched itself as a valuable platform to serve these purposes.

We held our first ADMM-Plus in 2010. It brought together all ten ASEAN member states and eight "Plus" countries - Australia, China, India, Japan, the Republic of Korea, New Zealand, Russia and the US. The ADMM-Plus seeks to be an "action-oriented" platform - to use the words of Secretary Hagel. For example, the ADMM-Plus Humanitarian Assistance and Disaster Relief (HADR) and Military Medicine exercise was held in June this year. It was substantive and involved 3,000 troops, six ships, 15 helicopters, from all the 18 militaries, as well as military medical, engineering and search and rescue teams. It allowed constructive engagement and practical cooperation between all 18 militaries including the US and China, helping to build confidence, relations, and mutual trust. Japanese and Chinese soldiers worked alongside this exercise.

When Typhoon Haiyan struck the Philippines, many countries responded individually. The ADMM-Plus militaries could perhaps have been more effective working together, and these challenges point to the need for more coordinated and collective efforts. Not just in terms of enhancing cooperation in HADR response, but also to address other regional security challenges. As a first step, we welcome the ASEAN member states' proposed measures for reducing the risk of misunderstandings or mishaps in the South China Sea, such as the suggestion by Brunei to establish hotlines to maintain government-to-government contact, as well as Vietnam's proposal for a no-first-use of force agreement.

US' Continued Role in the Asia-Pacific

The US, as a resident power in the Asia-Pacific for the past 50 years, needs to continue that role as a stabilising force in the region. But the US needs to play this role fully aware of the changing dynamics of a rising Asia. Singapore is grateful for the consistent and strong commitment by the US to the region, as it actively participated and played a key role in our platforms the ADMM-Plus, East Asia Summit, ASEAN Regional Forum and Shangri-La Dialogue.

Singapore is also thankful that the recognition of the importance of Asia has bipartisan support. Whether under Republican and Democratic Administrations, the US Secretary of Defense has without fail attended every year's Shangri-La Dialogue held in Singapore since 2004. In fact, Secretary Hagel had a founding hand in the Shangri-La Dialogue. We are confident that this US commitment to our region will continue.

As Secretary Hagel said in Aug 2013, it is "clear that the Asia-Pacific region will also help shape the trajectory of global security and prosperity. And because America recognizes that its future will be even more connected to this part of the world, we are rebalancing the weight of our global diplomatic, economic and security engagement toward the Asia-Pacific."

Conclusion

Ladies and Gentlemen, let me conclude by stating that political will and leadership will be required from all countries if we are to maintain peace and stability in the Asia-Pacific region. While there are areas of concerns, we also see positive signs. The US-China relationship is of paramount importance to regional and global stability. Singapore looks forward to enlightened and forceful leadership from both the US and Chinese governments to help achieve stability and progress for Asia and indeed, the world.

In the bilateral summit between the two leaders, in Sunnylands, California, President Obama reiterated that "the US welcomes the continuing peaceful rise of China as a world power", while President Xi Jinping stressed that he continued to believe that "the vast Pacific Ocean has enough space for the two large countries of China and the US". This accommodative and open stance declared by both US and Chinese leaders surely sets the appropriate tone and example for all countries to navigate through, successfully and peacefully, the changing dynamics in the Asia-Pacific region.