Following is the transcript of an exclusive CNBC interview with Chan Chun Sing, Minister for Trade and Industry, Singapore. The interview was broadcast on CNBC's Street Signs on 5 June 2018.
All references must be sourced to a "CNBC Interview'.
Interviewed by CNBC's Martin Soong.
Martin Soong: Let's bring in our next guest- we have the pleasure of having an exclusive conversation with Chan Chun Sing. He is Singapore's newly-minted trade and industry minister. Minister great to see you and appreciate your time.
Chan Chun Sing: Thank you for having me here.
M: Pleasure is ours. So, you're about a month into this new job, the Trade and Industry portfolio. These are pretty interesting times to take over a portfolio like that given what's been going on.
C: Indeed. There are challenges both internal and external. I think on the external front we are all familiar with the trade tensions that are ongoing around the world. We stand for an open, rules-based system and we would like to encourage people to continue to support an open, rules-based system. Because we think that is the best way to prosper the entire world's economy and for everyone to benefit. But having said that, we always know that, you know, in globalization there'll be winners and losers. But what is important is for a government to do its role, to help redistribute the fruits of the growth for everyone to be able to benefit from this. When the government fails to do this, then you will have the push-back in some societies whereby people close themselves off towards globalization.
M: Which seems to be what's happening at the very least in the United States. It's a backlash against the open system that you talked about as well. So what's interesting is, for Singapore, small, very open, very trade-dependent as well, does this backlash make the island-nation more vulnerable, more susceptible?
C: That will always be an evergreen challenge for an open, small economy like Singapore. So the way we do it is to make sure that we continue to diversify our markets. We deepen our connections with as many markets as possible. But at the same time we must make sure that we continue to upgrade our industries to create new industries, new products, new services for the world market so that our people can continue to enjoy the kind of growth and kind opportunities, and finally to bring a good salary home to take care of their families.
M: Indeed, absolutely. I understand here at Ecosperity that one of the things you're noting, and I believe you're talking about as well is, you've got globalization on the one hand, and threat to the globalization posed by these protectionist backlashes which we've just been talking about but at the same time, concurrently, disruption, technology disruption, fintech and the like. That proceeds on, there's no holding that back.
C: For us, it's very clear. You can't stop the tide of technological change. So we need to embrace it. Therein lies our opportunities as well. How do we embrace the new technologies, whether is it data, information, robotics? How do we ensure that we embrace such technology, change the product design, change the production process, and outreach to the rest of the world. We think that if we can embrace such technologies well, we can actually use it to transcend our geographical limitation and size. The market in Singapore will not be limited to just Singapore, but we are reaching out to the global market as our hinterland. And that will allow us even more opportunities in the next step of development with greater access to resources, greater access to markets.
M: Minister I have to ask you, U.S. and China, the trade tensions have been going on for weeks, if not, months now. The first shots have been fired. The Trump administration has actually acted to implement tariffs, steel and aluminum - the 232 tariffs. And now we are involving Europe, we are involving Mexico, we are involving Canada as well. This is threatening; the risk is this is becoming global. Is this what a trade war looks like?
C: This is very dangerous for the entire global trading system, because when one country after another starts to enact their own protectionist measures using all kinds of reasons, the entire global system will unravel and it is not good for anyone at all. There's not going to be any winners in this war. But on the other hand, we need to stay calm and realize that there are more and more interdependencies between the global economies. Today, it is not about A versus B. It is about both A and B working together in a global production chain. If you take any product, the iPhone in your hand, it is not produced by any one single country. In fact, it is a global production chain, a global supply chain that brings this product to the market. We will soon realize that there is no way we can cut ourselves out from the global production system and it is actually a self-defeating exercise if we just try to have this me versus you kind of mental models.
M: I'll ask you a personal question, and I won't be surprised if you actually give me the official government response, but with regards to the U.S. and China, many people think that, look, at some stage, this has just got to stop. If and when President Trump feels that he has his "political win" that will serve his interest and his party's interest coming up in November at the mid-term elections. Are you as optimistic?
C: I think we have to watch this carefully, because I think that the forces that have been unleashed in the U.S. domestic politics are quite deep and we shouldn't underestimate the kind of changes that are within the U.S. political system. And likewise in China, there are deep, profound forces that are reshaping the next phase of the Chinese growth trajectory. So for us, we have to go beyond the surface to understand the deeper underlying forces and then we will have a better sense of where we are going.
M: Minister, a quick one-line from you, Trump-Kim summit, June 12th, Singapore, are we ready? All systems go?
C: We will do our best, there will be many more uncertainties, many more new demands, but I think Singapore will try do our best to be a good host, to facilitate this historical opportunity and we wish all parties the very best in their endeavors.
M: Fantastic. Minister, thank you very much for your time, appreciate it very much.
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