Asean-China FTA must get priority, says Singapore Prime Minister

PRIME Minister Goh Chok Tong has said Singapore and China place priority on the Asean-China free trade agreement (FTA), and only when it has been concluded will Singapore begin negotiations on a similar bilateral pact with China.

'Both of us (Singapore and China) agree that we should focus on the Asean-China FTA . . . negotiations have been in progress for the Asean-China FTA and we will strive to get the process completed,' Mr Goh said yesterday at the end of the Beijing leg of his six-day China visit.

'We don't want the bilateral FTA in any way to affect the larger interests of the region and China. So that remains our priority,' he said.

Indeed, the bilateral FTA is part of the larger Asean-China FTA framework that will see economic integration between the regional grouping and the mainland - which is why discussions on the bilateral FTA will hinge on completion of the Asean-China FTA.

'Once that is done - which I expect can be completed by, maybe, June next year - I think some time after that, we can begin negotiations on the bilateral FTA,' Mr Goh said.

June 2004 is when the chapter on goods in the Asean-China FTA is due to be finalised. In the meantime, Singapore and China will begin separate exploratory studies for a FTA.

Negotiating a bilateral FTA was one of the initiatives mooted when Mr Goh met his counterpart Wen Jiabao here earlier this week. Asked how Asean countries would react to moves towards a bilateral FTA, Mr Goh said they would watch with interest.

He noted that earlier this year, Asean ministers agreed that individual Asean members could negotiate bilateral FTAs with China as part of the overall FTA framework between Asean and China.

As the proposed bilateral FTA with China would cover goods, services and investments, it would encourage a bigger and freer flow of trade and investments in both directions. Reduction of tariffs would help Singapore exporters sell to the vast Chinese market. Conversely, the pact would help Chinese companies go global, using Singapore as a window to the world.

The other initiative that arose from Mr Goh's discussions with Chinese leaders is a China centre in Singapore.

Modelled on the existing German Centre, it would enable mainland companies to showcase their goods and services.

It would serve as a window for Chinese companies to 'look out' and would let foreign companies based in Singapore 'look into' China.

Mr Goh said his visit has 'consolidated' Sino-Singapore ties.

He noted that the Chinese learn and adapt to new situations very quickly. One example is how they transformed themselves from a command economy to a market-oriented economy within the last couple of decades.

Singaporeans, he said, must change their mindsets and appreciate the potential of China. One way would be to send more young civil servants to do post-graduate studies at Chinese universities in addition to the current preferred choice of an education at an Ivy League university.

'If we do that, then in 20 to 30 years' time, when China becomes a very powerful economy, we will have a large number of people who understand China,' he said.

The Chinese, he pointed out, have been quick to grasp the usefulness of Singapore by sending large numbers of their students to study in the republic.

In their interaction with the Chinese, Singaporeans should adopt a humble approach, not one of trying to teach the Chinese, Mr Goh said.

'Even now, we are learning from China the way they do things, so it's a mutual learning exercise,' he said.

Mr Goh and his delegation are now in Kunming, capital of Yunnan province.