Thank you, Mr Turnbull, Major-General Yao. 

Let me start with one cardinal rule in politics that I was taught as a novice, and obviously many of you here know Mr Lee Kuan Yew. That cardinal rule has stayed with me since, that you live with the reality as is, and not as we wish it. So, I thought I'd begin there and address the issue on the South China Sea (SCS) and what are the facts on the ground now. Let me just give a brief summary because you gave a brilliant introduction and following, of course, the very wise words of former Prime Minister Mr Turnbull.  

The Chinese, or more precisely, the People's Liberation Army (PLA), has established a series of forward bases with intelligence, surveillance and reconnaissance (ISR), area denial, force-projection capabilities on features within the SCS. And this includes airbases with hardened hangars, helipads, full-length runways that can accommodate Chinese fighters, naval patrol aircraft, and military transport aircraft. 

If you look at all the China-controlled features in the Spratly, some in the Paracels, all of them have ground-based air defence systems, such as surface-to-air missile capabilities, large anti-craft guns and close-in weapons systems.  Many China-controlled features also contain large underground structures, possibly to store munitions and other supplies. Fiery Cross Reef is equipped with communications and sensors array which can function as a signals intelligence hub. And just recently, a maritime rescue centre was also added there. Administrative infrastructure has been built, in particular on Sansha, on Woody Island, the largest island of the Paracels which the Chinese upgraded from county to prefecture, just below that of a province. So in sum, China has established a forward defence line some 800 km from its mainland coast. And this development from the Chinese perspective is in direct response to the encirclement policy articulated in the early 1950s through the three island chains. 

So despite the ruling of the Arbitral Tribunal in 2016 on the SCS dispute, I don't think there's anyone that thinks that any country, at this point anyway, would attempt to forcibly push the PLA out of the SCS features. Do the PLA bases and the infrastructure that I've just described make it an equivalent of say, the Indo-Pacific Command (INDOPACOM) in Hawaii? To put things in perspective, the military facilities in Guam are approximately 12 times the size of China's expanded features in the SCS; and Hawaii, about 70 times; I think Iwo Jima, a key island in the Pacific Theatre where the US and Japan fought over in the Second World War is comparable – about one and half times. 

So over the last two years as we know, the US under the Trump administration has conducted 11 Freedom of Navigation Operations (FONOPs); the most recently being 11 February, where two destroyers USS Spruance and USS Preble sailed through the Spratly Islands, within the 12 nautical miles. Last year, UK and France also sailed their warships. These FONOPs are conducted based on the Tribunal's ruling. But the Chinese have declared that they reject the ruling and have responded sometimes robustly to these FONOPs. All of us are familiar with USS Decatur that sailed through the Spratly and the Chinese warship came dangerously close. 

This reality – the changed facts on the ground – makes the prospect of de-conflicting the competing claims less relevant and realistic. 

Even other claimant states have said or acted accordingly. As President Duterte put it in November last year, "China is already in possession [of the SCS]. It is now in their hands". Vietnam, which has the largest area of Exclusive Economic Zone (EEZ) dispute with China and its nine dashed lines and thus the most potentially affected, has sought to avoid escalating tensions, even as it has routine ground encounters with China. Malaysia and Brunei have not played up their claims. Indonesia, has taken some measures to safeguard its sovereignty. Indonesia has potentially overlapping EEZ waters with China in the Natunas – Indonesia has deployed extra warships, fighter jets, surface-to-air missiles, and most recently, established a military base on the Natuna Besar Island. President Jokowi visited the Natunas in 2016 and even sat in the cockpit of a Sukhoi fighter, to make a point about their claims.

With these new realities, the outcome of this modus vivendi remains uncertain, with no assured stability.  If any side, and I'm talking any side beyond the claimant states chooses to be more assertive or under-estimates the resolve of the other party, more trouble and uncertainty may ensue. 

In this context, ASEAN has taken a practical approach, to work on the Code of Conduct (COC) to constrain if not bind behavior. Bill, you said that Prime Minister Li Keqiang said it would take three years, we saw that as something optimistic but you've read the reverse. The proposed timeline for the COC to be finished in three years… well, because before that, there was no timeline.

As ADMM/ADMM-Plus Chair last year, we developed the Guidelines for Air Military Encounters (GAME), the first of its kind in the world. And as ASEAN-China Coordinator, Singapore also facilitated the successful conduct of the first ASEAN-China Maritime Exercise. All of these are practical confidence-building measures that minimise the risk of miscalculations, and build trust and confidence among militaries. 

Thank you.