Prime Ministers Christopher Luxon and Lee Hsien Loong announced on Monday they would upgrade a formal partnership between New Zealand and Singapore by the end of 2025.
The Enhanced Partnership is a cooperation agreement signed by Prime Minister Jacinda Ardern in 2019 which covers trade, security, science, people, and climate.
What exactly the upgrade will be remains to be seen. Officials have been told to find some additional areas of cooperation to mark the 60th anniversary of diplomatic relations.
In the meantime, a “sixth pillar” is being added to the partnership covering supply chains, which have become a big focus for businesses and governments after the pandemic.
Negotiators will begin to work on adding electronic certification for primary products and a way to facilitate trade in “essential items” during crises to the existing trade deal.
It's okay if that sounds boring. The point isn’t so much about the details and more about the message being sent: New Zealand and Singapore are pro-trade.
That message was not a countercultural one a few years ago, but there has been a sudden turn inwards as some big countries seek to become more self-sufficient.
While it is a global trend, it matters most in the United States and China. These two superpowers are seeking to localise strategic industries and insulate domestic ones.
Whether it is a good strategy for those countries is an open question, however it is not an option for New Zealand or Singapore which are dependent on international trade.
“Other countries can deglobalize — we can not,” Lee Hsien Loong said, in a press conference.
If New Zealand had to eat all of the food it produced, he said, pausing for laughter, it wouldn’t be able to make a living. Small nations have no choice but to trade.
When asked whether Singapore and New Zealand should be diversifying trade relationships and becoming less reliant on China, Lee appeared unconvinced.
“We would like to do business wherever the business is — and China is a very big market. To say that you don’t want to do business in China, well, you have to have a very stout heart”.
But it was also important for the region to remain connected to the United States, Europe, and India—as well as New Zealand and Australia—so that trade can operate “omnidirectionally”.
“If there are ups and downs in one place you can’t help being affected by them, but you will hopefully not be swamped by them,” he said.
National interest = international order
The world was “troubled” and, while small countries couldn’t solve these troubles, they should take a stand in favour of international cooperation.
“Our vital national interest is an international order which is orderly … and enables countries big and small to live together — where there is a basis to decide things objectively and not just based on the law of the jungle,” he said.
The Prime Minister of Singapore gave lengthy and thoughtful answers to the four questions the media were permitted to ask following his bilateral meeting with Luxon.
Staff later reflected he may have been savouring his last moments in the job, as just hours after the press conference he formally announced his long-planned resignation.
When Luxon spoke it was mostly to agree with Lee’s comments. However, his government has been shifting New Zealand’s foreign policy towards Australia and the United States.
This is mostly a defence posture, related to the AUKUS nuclear submarine pact, but could easily have trade implications if relations between China and the US worsen.
In a worst case scenario, a war over Taiwan could split the world into two trading blocs and entirely upend global supply chains. The best case is that the status quo continues.
Luxon’s visit to the Philippines will put the security agreement in the spotlight, as it is another likely candidate for ‘Pillar II’ of the AUKUS pact — along with Japan and Korea.
China sees all of this as an effort to put the rising power under siege and protect US hegemony in the Pacific and beyond. Which, understandably, it doesn’t like.
As New Zealand seeks to improve its trade relationships in South East Asia, it will do so in the shadow of two economic and military superpowers who are struggling to co-exist.
16 Comments
As New Zealand seeks to improve its trade relationships in South East Asia, it will do so in the shadow of two economic and military superpowers who are struggling to co-exist
It quite tough job to balance relationship with China vs one with US. But one thing is clear, NZ relies on trade, it feeds our 5 million people. NZ also traditionally part of the West, we have friends and family there.
in the end, maybe we should pretend there isn't a power play between the two giants, and Taiwan isn't there to defend. Ukrain is tragic already.
No NZ relies on debt. Our trade balance is sunk in the effluent ponds of the FIRE economy.
Edit. I'll add as simple evidence that Singapore is home to the credit card giants, the ones that strip money from here a pay almost no tax on massive revenue . And this "free trade" leaves us with nothing.
Luxon has come onto the bridge of the Titanic, about 45 minutes after it hit the iceberg.
' We need the freedom to play deck quoits tomorrow'.
It's that stupid. Globalism is over - the Limits to Growth have been hit, there is now posturing for a post-peak world. Nobody should be surprised; Saul wrote The Collapse of Globalism long time ago; I have a copy on my shelf. He argues for 1995 as the inflection-point; Mike Moore and Gatt territory. Ancient history.
Yet this mantra-pumped turkey is still seriously pushing a line so obsolete?
Peace in our Time....
The sheer vacuity of so many joint prime ministerial communiques https://beehive.govt.nz/sites/default/
from the linked communique. "7. The Prime Ministers recognise the need to limit global warming to 1.5 degrees Celsius and support the global economic transition that is under way as part of their shared commitment to implement the Paris Agreement and seize growth opportunities in the green economy. New Zealand and Singapore will work together to ensure their economies are prosperous, clean, and future-proofed."
The horse has already bolted on 1.5deg C. Don't know Singapore's electrical energy sources but I'd bet their petrol and diesel energy is one helluva lot less than NZ. Guess is <33%.
There's a problem straight away for NZ.
Best too keep your mouth shut (Luxon) on matters of which you have little knowledge.
"Currently, more than 95 per cent of Singapore's electrical supply comes from natural gas. Most of our LNG supply is piped from Malaysia and Indonesia."
Interesting also SGs longer-term energy R&D https://www.channelnewsasia.com/singapore/nuclear-energy-fusion-fission…
Well at least they going to look into Nuclear energy and not dismiss it out of hand. Build up some internal expertise as well. Now that'd be one area NZ could piggy back off Singapore.
"Singapore has to wait for a small modular reactor or the newer generation of thermal reactors to be deployed commercially, and understand the safety profile before making a decision. " Small modular nuclear re-actors were evidently touted back in the sixties or seventies but nothing came of them. Lets hope its not all smoke and mirrors about them now.
Yup, Singapore does longterm planning much better than NZ. A key to that is that they have had one longterm stable non-corrupt Party in power for over 60 years that run a very tight ship.
That is one big trade off of full liberal democracy and elections every 3 years.
Perhaps we should be copying the UK as this report states that they have now become the worlds 4th largest exporter of goods and services and we do now have our own free trade deal with them.
. https://www.express.co.uk/news/politics/1886543/kemi-badenoch-uk-export…
Pleas stick to facts
UK exports 855.
UK imports 891.
The UK is a net importer, plus which the North Sea - the last real wealth they had - is nearly tapped out. What is so great about a sinking ship? And why would you bother associating with one?
So many people only count the in-ledger. I can see why you'd want to, but I couldn't do it myself. Seems untrue, somehow.
Wrong.
Both sellers and buyers, are depleting a finite planet. None are valuing that process - neither the energy depletion/entropy, nor the physical draw-down - but ALL are a part of it.
But those trading in the red are heading for an end-point; either they default, go to war, or drastically reduce activity. What we are seeing, is the last act in globalisation - the First World screwing the Third. At some point, they won't accept our debt.
Both sellers and buyers, are depleting a finite planet.
Lucky then there is a massive fusion reactor in the middle of our solar system with a lifetime of billions of years pouring out a massive amount of energy. Seriously I don't understand why people like yourself have such a negative view of where civilisation is in terms of ability to organise and exploit new sources of power, especially latest generation nuclear including thorium.
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