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Thank you very much and welcome to a real highlight of the day after the Prime Minister's speech. This morning we have the man of the hour, the Deputy Prime Minister, who has just come back from negotiations in the United States on trade. It's obviously easy, nothing challenging there. And then I think you've just ... | |
shy, get ready to line up at the microphones with your questions for the Deputy Prime Minister. Deputy Prime Minister. Thank you very much. I just want to say a few words. First, I want to thank you for inviting me to this conference to have a chance to speak to you. Other than answering difficult questions, I would... | |
And I would like to make a pitch for our Expo pavilion. If you have time, if you are in Japan, do drop in to Osaka and pay a visit to our pavilion. It's outstanding. It's red in colour, it's a little sphere, it's a little red dot, we call it. I think it represents Singapore very well. And I'll show you a very enjoya... | |
I think we talked about the world that we are facing that's increasingly becoming uncertain and full of challenges and difficulties moving forward and a lot of variability. So I think it is something that we have to confront with. By the same time, we are also strengthening Singapore's value proposition to the world b... | |
We will continue to work with the like-minded countries to move forward our economic agenda. As I said, I just came in from US just to give you a very quick update of my discussion in US. I went there with four key objectives. First is to have a first-hand information assessment of the economy, how it's going, where ... | |
And secondly, to meet up with various congressmen from both parties to engage them, to share with them about Singapore. And thirdly, to meet up with the administration to discuss areas of collaboration, how we can deepen our cooperation to create more opportunities for us. And lastly, to also discuss issues relating ... | |
On the first issue of economy, it's surprising that the US economy continues to be relatively resilient. When I meet many businessmen in the US as well as academicians, the feedback I get is that the economy outlook seems cautiously optimistic. | |
Maybe because of the big, beautiful bill that President Trump has just passed that has entrenched the tax cuts and the benefits and support for the businesses. So the outlook seems to be quite optimistic, albeit cautiously so. | |
Secondly, at the same time, inflation seems to be muted and they expect maybe one of the reasons is because the full impact of the tariff hasn't flown through yet. So they are still waiting to see whether costs will go up in the second half of the year. But so far, inflation seems to be moderated. So I think these a... | |
So I think overall, most of the American businesses are cautiously optimistic about the future. Secondly, when I met the congressman, several of them from both parties, I tried to impress on them the good relationship that Singapore has with the US, the long term and deep engagement that we have. And particularly, th... | |
And we are also keen to continue to explore how we can work together with the US. And we hope the congressman will continue to support Singapore's engagement with the US. And when I met the US administration, we also talked about cooperation between the two countries beyond just tariffs and beyond just investment and... | |
We also discussed the cooperation in digital economy, in climate change, sustainability in the green economy, and how we can continue to work together in many of these areas that have potential for growth. And I also encourage them to continue to engage Asia, not just Singapore, but the larger Asia, because ASEAN, for... | |
So I encourage them to continue to engage with us and to find ways to work together within the US, Singapore, US and ASEAN. And lastly, on tariffs, we discussed the tariffs that the US has introduced since Liberation Day in April. And particularly, Singapore is subject to the minimum baseline tariffs of 10%. So my f... | |
Can we try to reduce it or eliminate the 10%? I think the answer for the time being was quite obvious. They are not in the mood to discuss any discount to the baseline tariff, which I think I shared with many of you earlier. | |
But we also want to put a placemaker to remind the US that at any point in time in the future, if there's flexibility to discuss the baseline tariff, we are interested in negotiating on the baseline tariffs. So I think we just want to register our interest. | |
At the same time, when we discuss with them, I think the US has mentioned several times that the baseline tariff may be adjusted going forward. So we also wanted to know whether the baseline tariff will stay at 10% or will it be higher or lower. And the answer was a non-committal. And they are still reviewing the ta... | |
I think there's significant uncertainties. I did not have a chance to meet the Secretary Lutnik. And therefore, we didn't go into details on negotiation on the pharmaceutical tariffs. And I think the administration's focus now is to finish the negotiation on the reciprocal tariffs. So after that, then they will sta... | |
And generally, I think we continue to have very good working relationship between the US and Singapore. And we are happy to see that the US has completed negotiation with several countries and several groups, economic groups, including the EU. And I think this gives us a sense that there's a good progress in a tariff... | |
I'm not sure whether the uncertainty has really been eliminated or even reduced. Say, for example, to start with, despite the fact that they have completed negotiation with several countries, the details are not yet fully discussed or disclosed. And how, for example, the definition of rules of origin, how do you dete... | |
And how to implement some of these tariffs because it's very complicated to have different tariffs for different countries. And how do you deal with inter-country transfers, transshipment, re-exports, remanufacturing, and value-added manufacturing, and so on? How do you account for the contribution, the components fr... | |
On top of that, there's also uncertainty as to the sectoral tariffs, which has not been determined. And the baseline tariffs, as I mentioned, whether it will stay at 10% or whether it will be higher, is something that we remain yet to be seen. And beyond the tariffs discussion, there's also the question of how countr... | |
Let's say, for example, the EU has committed to make an investment of $515 billion over a period of time. And whether these investments will be new investments or whether there will be investments that will be diverted from investments into other countries is a question that we do not know yet. Japan has also committ... | |
Whether the Japanese investment in Singapore will be diverted into the US is a second question that is yet to be seen. So there are uncertainties as to how countries will respond to the outcome of the tariff negotiation. Some countries have also committed to purchase more from the US. And they would have been purcha... | |
And therefore, exports from these countries to the affected countries will be changed. So I think these uncertainties as second derivative uncertainties that no one is paying much attention yet because we need to have the tariffs settled. Then we'll work out how the secondary impact will be. And then the medium to l... | |
If countries who have investments in high tariff countries may decide to move their investments to relocate their manufacturing plant to a lower tariff country so as to benefit from a lower tariff imposed by the US. So this will result in shifts in the supply chain. And these shifts are another uncertainty that we ar... | |
But in the longer term, that's medium term. In the longer term, the concern and uncertainty that we are facing really is how this impact the overall global trading system. What we call the rules based multilateral trading system, that we depend on rules respecting trade agreements with one another and not to change a... | |
But tomorrow, if something happens, I will decide to change my tariff rate that I impose on you. And that is something that is very uncertain. And that has been seen over the last few months as you see tariffs being negotiated. We have a minimum baseline tariff of 10%. And it is at the risk of being adjusted going ... | |
It is something that we will need to recognize and to adjust ourselves and to respond to it. And I'll talk about response later on. Otherwise, I'll finish all the time that we have. So I'll leave it now back to David. Thank you very much. No, thank you for that brilliant sort of tour of the horizon, because you've... | |
They had been talking to the Americans and they said, well, why don't we do zero for zero? And they were told, no, no, we don't do zero now. Ten is the new zero. So clearly you're in the same world of ten is the new zero. And I guess... It may not be ten. It could be whatever it is tomorrow. Exactly. So I'm gla... | |
I guess one of the overarching frames to so many of your remarks is the sense that I certainly get talking to different governments in recent months, that Trump 2 is distinctively different from Trump 1. That there was in some ways almost a continuity from Trump 1 to the Biden administration, but there's something ne... | |
And so I guess that brings me to a kind of big geopolitics question, because that's my kind of beat. So Singapore has this interesting position you take on geopolitics, that Singapore does not take sides, certainly in the US-China competition, but that you do defend principles. And so where are we now, six months in... | |
certainly say, US and China? And if your line is that you don't take sides because you defend principles, how is, what is it like to defend principles in the second Trump administration? How is that working for Singapore? Well, it's even putting President Trump aside, I think the environment is getting more challen... | |
as Singapore develops, I think the low hanging fruits have all been plucked. I think we are getting into a situation where it's very competitive. And therefore it's important for us to continue to find ways and areas that Singapore can do well and continue to find ways to survive and to continue to progress. | |
So I think Singapore, in the face of a contestation between China and US, we always say that we don't take sides. But in fact, we always take sides. We always take the Singapore side. We always want to make sure that Singapore wins. And we always act in the interests of Singapore and Singaporeans. We always adopt p... | |
And this is important for us because then we are looked upon as a very consistent, reliable and trusted partner. Because our decisions are always based on principles and always take into account Singapore's interests. So I think it's in a way, like Prime Minister said this morning, we can be quite boring because we a... | |
And we always try to explain our position clearly, our principles clearly, so that our partners understand where we are coming from. So I think increasingly, of course, it will be challenging for us to continue to find a way forward. But it is something that we have been doing so and we will continue to do so. What ... | |
Because we are small, we are compact, we work very closely with our workers, with our businesses. And that's why SBF is here. So we are happy to work very closely with them so that we can move very quickly. And in this uncertain world, as I mentioned just now, there are a lot of uncertainties. But that actually req... | |
Countries and economies that are able to move fast, I think will be the winner. We say the same thing to our SBF and our businesses. Businesses that can move fast and adapt to the new landscape will be the one that will win. They will emerge as a winner. So I will encourage our businesses to adapt themselves, to be... | |
And we also want to make sure that our workers are able to embrace the new realities very quickly. And that's why we will invest very heavily on the training and upgrading of our workforce to make sure that they are ready for the future. And that's why we have a scheme called Skills Future Scheme to prepare our worke... | |
It's a sign of the times that in this morning we heard about predictability, reliability, and then separately about comparative advantages. But actually in this world that we now live in, being reliable and predictable is your comparative advantage, right? Who knew that that was going to mark you out from some of the... | |
I'm going to take the liberty of my geopolitics role to ask you an even larger question about the role of your big partners in Asia. So one of the lines that I hear causing real concern in some of the other governments that I've been visiting in recent months around the world is, | |
Can we even take for granted the idea that America is focused on the competition with China above all else and is willing to, for example, pull out of Europe, certainly militarily, to focus all of its efforts on the Asia Pacific, on the Indo-Pacific? Because I have been surprised by governments in this hemisphere sayi... | |
We have our moments of doubting that this talk of focusing all efforts on the competition with China, focusing all efforts on, say, Taiwan, we don't even know if we can rely on that. There's a possibility that maybe we'll wake up and find the Americans will just pull back completely. Does Singapore have that occasion... | |
Well, I think you have to take a practical view because the contestation between US and China is a reality. And they will continue to compete, continue to try to outdo each other. And I think that will last for a long time. But it doesn't mean that in between there will be periods of cooperation and collaboration an... | |
And we are hoping that the relationship between the two, US and China, will be a stable one. Even while they compete with one another, it doesn't mean that they have to go all out to get at each other. So there is a possibility that both of them can find a way forward while they compete, but at the same time have a s... | |
And it is also not possible for the US to devote all its attention to China and neglect the rest of the world. I think the US is quite clear in its mind that China is their main competitor today and they need to deal with China. But at the same time, they want to keep the rest of the world also engaged. And that is ... | |
I reminded them that it's important to continue to engage Asia, because Asia is a very important part of the world, not just from an economic point of view, but from a security point of view, from geopolitics point of view. It's important for US to continue to be present and engaged in the Asia Pacific region. Well,... | |
is actually, you know, this talk of prioritizers in the American administration who want to abandon Europe to focus on Asia, is actually this just a cover for isolationism? Are we going to see America just kind of pulling back to its own shores completely? Did you detect that in Washington? Not really. I think when... | |
But from time to time, I think the priority may be different. The focus may be different. Some priorities will be urgent and they have to pay attention to. But I think over the long term, both Europe and Asia continue to be a very important part of a US geopolitical strategy. And they do have an Indo-Pacific strateg... | |
So I have one more question for you about uncertainty, but then I'm going to put the audience on the spot. So please, there are microphones. I think we have four microphones out in the floor. You know the drill by now. If you have a question for the Deputy Prime Minister, if you can stand behind one of those micropho... | |
Is there a particular impact for a very trade-intensive country like Singapore if, in at least the short term, one of your speakers this morning, Ambassador Menon, said that one of the things that a government should not do is just kind of wait and see, just postpone all hard decisions. If I was a member of a board ... | |
if that's a 30, 40-year investment worth tens of billions of dollars, the incentive, the temptation to just kind of wait, because there is so much uncertainty, must be enormous. And so at least in the short term, is that kind of just the idea of drift and wasting a few years while we wait to see what happens with Ame... | |
I think there is a risk for countries to adopt a wait and see attitude and even for companies to adopt the same attitude, and you may miss out on many opportunities. The idea is that you can wait, but you should not be just see. You can wait and do, because it's important for us while we wait for more greater certai... | |
So you just have to continue to find ways to move forward in the absence of perfect knowledge, but based on what you know, make your calculations, make your judgment and move forward. I think that's what business leaders will do. And as good, the business leader will make the right judgment and the right calculation... | |
But at the same time, we are not wasting time. We are continuing to invest in our people, as I mentioned, upgrade our people, prepare them for the future, invest in AI. These are no-regret moves. And we are continuing to expand our network of free trade agreements with more countries, with more regions. And we ar... | |
We just finished a negotiation on our upgrade to ASEAN trade goods agreement, Artiga. And we are going to sign it later this year. And so hopefully, we will continue to strengthen ASEAN integration. We are also exploring collaboration between ASEAN and EU, ASEAN and GCC. We are also strengthening partnership betwee... | |
And we are encouraging collaboration between trading groups to see how we can move forward while we are waiting to see how the tariff landscape will pan out. At the same time, we are also exploring new areas of collaboration. Digital economy is one area that is very exciting. Despite uncertainty in tariffs, I think... | |
particularly in AI and in the digital payment systems and digital trading system. I think these are areas that are not competitive in nature, but facilitative in nature. So I think these are areas that I think many countries can still come together and to explore ways forward that we can work together despite the un... | |
There's a kind of practical, you can't change the reality of where the world is. But we have a gentleman here behind the microphone. And I'm going to take a couple of questions. So first you, and then directly at the back, there's someone with a lightsaber who is not Darth Vader, but I think it's one of your assist... | |
Like, do you try to play hardball or more conciliatory? And how do you make your feelings known to the other party without hurting them too much? Asking me? And we'll take one... You're asking me? No, no, no. And then we'll take the lady at the back in the middle. All right. Hello. Okay, go ahead. | |
Good afternoon, Mr. Gan Kim Young. My name is Aiko from Catholic Junior College. So to echo what you have said, in light of US's ambiguous enforcement of transshipment and also unclear definition of rules of origin. So for example, we've seen shifts in supply chain, particularly in sectors like solar manufacturing ... | |
but also in maintaining regional trade credibility? Thank you. And we'll take one last question over there, if that's okay. Thank you, DPM Gan, for negotiating. You look very tired. I hope you get some rest later. But for now, maybe I want to focus on absolute certainties. As you mentioned, tariffs still have ma... | |
I want to focus on one certainty, which is the big, beautiful bill and the effects of the US dollar. And how would that impact Singapore and what are our strategies to mitigate the second-order effects? Thank you. Thank you so much, sir. Thank you very much. First, on negotiating strategy and approach, that's our ... | |
But I think it depends on specific situation and also depends on the other party, your counterpart. And depends on what is his interest, where he's coming from. The art of negotiation really is to know what he needs and what he can give. And to also understand what we need and what we can give. | |
If we can give what he needs and he can give us what we need, that's perfect solution. But very often, what you need is what he doesn't want to give. And what he needs is what you don't want to give. And that's where the problem is. So really, in negotiation, you have to go through the process of discovery, of unde... | |
And therefore, we try to find common space so that we can have a common agreement. Sometimes in negotiation, you may arrive at some agreement and you may also agree that certain areas that we cannot agree. And we just have to agree to disagree. So I think that's a process of discussion and negotiation. I think very... | |
But when you come to multilateral agreement, it's a lot more difficult when you have multi-parties involved, because then you have to make sure that everyone's interest is taken care of and everyone's concerns are addressed. And that's a lot more challenging. But having said that, I think at the end of the day, you ... | |
Sometimes one side may win more, the other side may win less. But at the end, if both sides can have a winning outcome, I think at least you have a basis to move forward. If it is negotiating for a win-lose outcome, I think it's going to be very difficult. And therefore, when you go into a negotiation situation from... | |
you will see that it will benefit you and you will also benefit Singapore. I think that you have a basis to start to negotiate, start to narrow the gaps between the demands from both sides. And hopefully you can have a win-win outcome on our negotiation. I hope that answers your question in principle. So I can't go... | |
In fact, that is one of the uncertainty and one of the challenges that we have. And it's not just the definition. However you define the rules of origin, enforcement is another challenge. Because you have to be able to trace where the origin comes from and verify where it comes from. Let's say for example, if I buy... | |
the product's origin is Malaysia. But it doesn't mean that the product is produced in Malaysia. It may be produced in somewhere else than in Thailand. So therefore, under the rules of origin, it should be Thailand. But it is very difficult for me to find out where Malaysia has acquired the product from. So the rul... | |
Having defined that, we have to figure out how to enforce, how to track the product. How to track the rules of origin so that it is effective. So I think those are the uncertainties that we have to work through. And you are right that it will have an impact on the intra-ASEAN trade. Because whether the rules of ori... | |
So I think we just have to wait and see how the outcome of the disclosure from announcement from the US. And the last question on the big and beautiful bill. So I think if I know the ultimate impact on US dollars, I will be a billionaire. The question is, I think it's very difficult to predict how it will impact on ... | |
But I would say that the objective of the bill is really to institutionalize the tax incentives that was announced during President Trump's first term. And this, by introducing this bill, it will institutionalize these tax incentives. | |
And this will give investors more confidence that these tax incentives will last for many years and it's not just from year to year. So I think that will give confidence in the investors to invest in the US. And that will go towards President Trump's on-shoring strategy to bring back to US many of the manufacturing i... | |
And that, of course, will then have a consequential impact on the exchange rates. We have long lines of people. So I'm going to just work from the front, take one from the front and then one from the middle. Please. And if you could introduce yourself, say who you are. Hi there. I'm Prejna from Raffles Girls Scho... | |
Amid this, amid what Singapore's government and businesses can do, what role do you think, if any, that the youth and other citizens, regardless of age or job, can play in helping Singapore to flourish in the shifting global economy? Thank you. Good afternoon, Deputy Prime Minister Khan. In the last election, we w... | |
Even Prime Minister Wong said that what he has not covered in the morning will be picked up by you in the afternoon. I'm Albert Cheng from the Singapore Bullion Market Association, a trade association for the precious metal industry. In line with the Singapore ambition to position as a global city, our industry also ... | |
and also for other precious metals from 2019. All our members are aligned now and has dialogue with a couple of related government and ministry. However, I felt our recent need to be multi-ministry public-private partnership. That means we need to set up a PPP task force. My question is, how should we go about it, ... | |
We will take one last question from the front from Professor Koh. Thank you. DPM. I'm here. Okay. Prof. Welcome back from Washington. You don't look tired. You look very well. Thank you. Thank you. I want to ask you about two sectors which are very important to our economy, pharmaceutical and semiconductor. | |
Can you confirm that you didn't have an opportunity to engage the US administration on these two sectors? First, let me answer the question on the youth role. I think the youth today plays a very important role to prepare yourself for the future. And I think the future is full of uncertainties, full of challenges, f... | |
But that's the bad news. The good news is, actually, it's also full of opportunities. So the key is for our younger generation to prepare yourself to always be on the lookout for new and emerging opportunities. To always upgrade yourself to make sure that you master the skills of the future. And to embrace change. A... | |
But at the same time, even as you grow the economy, develop the economy, also pay attention to strengthening your social fabric. Making sure that no one is left behind. Work together with the community. Work together with the society to make sure that you continue to find ways to uplift the society and the community.... | |
Just now you mentioned about the task force men. Thank you very much. And if you have any problem, you can always email to me. If no one else answers your email, I will answer your email. Don't worry. I will... Do you have my email? I'll give you my email. Any one of you, if you want, you can always email me. My e... | |
So gan-kim-yong at mti.gov.gov.sg Singapore. So gan-kim-yong at mti.gov.sg. So you write to me. If you have any problem, you need someone to bring together multi-ministry, multi-agency to address your issue. | |
But my suggestion is actually SBF does a very important role in helping... I'm not erroring them. I'm just stating a fact. And to give them due credit because they do actually do good work in working with the TAACs, our trade association and chambers, to help them, to uplift them, to share with them what are the sche... | |
And also help them address some of the government agency issues so that you come together as an industry. So I think you can talk to SBF. I don't know the president's email. Maybe you can ask from him later on. But I've already given you my email. If you want, you can email to me. I'll email to him if it's appropriat... | |
Prof, thank you very much. Yes, indeed, I did not have a chance to discuss pharma and semiconductor during this trip. We did have a discussion on the pharmaceuticals earlier on. And officials are continuing to discuss on the pharmaceuticals, on the collaboration between US and Singapore on pharmaceuticals. That's at... | |
Semiconductor, we have not started discussing on semiconductor with regard to the tariff. With regard to access to AI chips and so on, we have discussion on how we can make sure that we will continue to have access to the AI equipment and semiconductors where necessary. So I think this is something that we have discu... | |
And we have lots of questions coming in through the QR code, but I'm going to prioritize actual human beings standing at microphones because that seems, despite the AI future that awaits us, I'm going to give the humans, Robin the iPad priority for now. So, Madam. Hi, I'm DPM. I'm Huiling from SPH, Chinese Media Grou... | |
Scene one, it's you are taking off, flying to somewhere to negotiate, or there are some bilateral visits or conferences. Scene two is you are in Pongo meeting your residents. My question is how do you think this is sustainable for SG60 and beyond? | |
What does it take to attract talent to do this very demanding job that you are doing right now? Thank you very much. Second question. We have one more at the other back. I'm very eager to answer that one. Hi, Deputy Prime Minister Gan. Thank you so much for working so over here. Thank you so much for working so ... | |
My question is regards to the sectoral tariffs, in particular pharmaceutical. Can you give us a sense of what the US side is trying to look for? | |
And in particular, I think in your previous remarks, you have mentioned about secure supply chains in your remarks to media. And of course, things have evolved since then. You know, Japan has provided this investment fund among things. So yeah, could you give us a sense of what exactly the US side is trying to look ... | |
Thank you for your insights even after all your travels, DPM. Earlier today, John Denton of the ICC remarked in his keynote that this is a moment, the current moment is not one of breakdown, but of transformation. And that how things go will depend on the actions we take now. Yeah, sorry. | |
And that connects to what you said about DPM on trade and global norms in a changing geopolitical landscape. Looking ahead to 2030 or even 2035, what do you see as a key driver or trend, whether economic, social, political, etc., that might make the difference between transformation and breakdown? | |
And if you're feeling game, how optimistic or pessimistic are you that we are in transformation and not breakdown? Thank you. First, let me answer Hui Ling's question. I think the key really is you must enjoy what you're doing. When I visit countries, I enjoy meeting people, getting to understand their thinking. A... | |
So when you meet the Americans, you understand their psyche, their approach, why they do certain things. And when you understand their reasons, there's certain rationale to what they do. And you look at your own perspective, they realize the difference. And that difference is sometimes very enlightening. And that h... | |
So when I visit countries, other than going to expo and visit our discovery, our pavilion, when I meet people, I think that discovery is very exciting. In Pong Goh, it's a different approach. And when I spend time in Pong Goh, I always treat that as spending time with my friends. | |
Because I'm sure in the evenings, you also go out with your friends, have dinner, have activities, do things that you like. So whenever I go down to visit my residence in Pong Goh, I treat them as visiting my friends, having a dinner with my friends. Going to do house visits is like visiting my friends in my friend's... |
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