(Bloomberg) -- Singapore’s top diplomat said he hopes China will use its “enormous influence” on Russia to help end its war with Ukraine, warning that Beijing’s decisions in the coming days and weeks could determine the future path of the global economy.
“The big issue now is what decisions and actions China takes,” Minister for Foreign Affairs Vivian Balakrishnan said in an interview with Haslinda Amin to be broadcast at the upcoming Bloomberg Live’s Asean Business Summit. “If you get a deepening of the bifurcation of the global economy, of supply chains, of technology, this will be a very, very different world.”
Singapore last month became the first Southeast Asian nation to say it is imposing unilateral sanctions against Russia for invading Ukraine, a move Balakrishnan said was necessary due to “the egregiousness of it all.” Calling the invasion “perhaps even a bigger moment than the fall of the Berlin Wall,” he said China has a greater economic stake than Russia in an “integrated multilateral rules-based world.”
“I hope they will assert their influence with Chinese characteristics, which means quietly and discreetly, but effectively,” Balakrishnan said of President Xi Jinping’s government. “That’s a hope now. Whether this is wishful thinking on my part we’ll see over the next few days and weeks.”
Singapore’s biggest banks have restricted trade financing for Russian raw materials including a halt on issuing so-called letters of credit in U.S. dollars for trades involving oil and liquefied natural gas, according to people with knowledge of the matter. Singapore Airlines Ltd. has also suspended all return services with Moscow due to operational reasons.
Singapore has rarely imposed sanctions on other countries in the absence of binding United Nations Security Council approval.
“We believe we are at an inflection point,” Balakrishnan said. “Little Singapore is standing up for principles and expressing a hope for the rules of engagement for this new era.”
Here are some other key points from the interview:
- Balakrishnan dismissed China’s claim that the U.S. is looking to form a NATO-style military alliance in the Indo-Pacific region, saying Southeast Asia is “not looking for one or the other superpower to be a godfather to Southeast Asia.”
- He called it a “strategic error on the part of the United States” to have abandoned talks on the deal that became the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. “Every time I go to Washington I continue to make this point that actually, the best thing you could do would be to return to the TPP,” he said.
- The war in Ukraine will likely result in “a protracted quagmire for the Russians” and “decades of instability.”
- He noted increased global defense spending “across the board,” citing Germany’s decision to channel $113 billion this year into a fund to modernize the military as a result of Russia’s actions in Ukraine. “I think you’re getting a reversion to the mean, which means that every country needs to make sure, as we do in Singapore, that we have invested enough to be able to defend our own interests,” he said.
- He said he was “pleasantly surprised” with the joint statements by the 10-member Association of Southeast Asian Nations. “You have to understand the diversity in Asean,” he said, adding only two of its members abstained at the UN General Assembly to condemn Russia. “Frankly, even that exceeded my expectations.”
- On the continued conflict in Myanmar, he said “there needs to be honest-to-goodness political dialogue” between detained civilian leader Aung San Suu Kyi and the military junta that overthrew her government in a coup last year.
©2022 Bloomberg L.P.
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