ESTIMATES OF EXPENDITURE OF SINGAPORE - FOR THE FINANCIAL YEAR 1ST APRIL, 1998 TO 31ST MARCH, 1999
Sir, may I continue with my response to the various points raised yesterday. When we adjourned, I was responding to Dr Ong Chit Chung's question on the United Nations. The second point he had raised on the UN was with regard to our candidature for the United Nations Security Council for the non-permanent seat. He asked me for a progress report. Members will recall that Singapore presented its candidature for the non-permanent seat in the Security Council for the period 2001 to 2002. The elections for that particular vacancy will take place in the year 2000 and, if elected, we hope that we can bring a constructive and useful perspective, shall I say, a small state perspective, to the UN Security Council. It is an important perspective because a majority of the United Nations members are small states. Participating in the UN Security Council will also allow Singapore to learn first-hand how the UN Security Council operates, both in its formal session as well as in the consultations. Since we became a member of the United Nations in 1965, we have never served in the UN Security Council which of course, in a sense, is at the very heart of the UN system. So far, Singapore is the only declared candidate for the Asian group seat for the year 2001 to 2002. Our candidature has been endorsed by ASEAN countries and many other countries, both from within the Asian group as well as outside the Asian group, have expressed their support for our candidature in writing. We recognise that within our limited manpower and financial resources, Singapore can do only so much at the United Nations. But let me assure the House that we will continue to do our part as a responsible member of the UN system and as a member of the international community. And that is one of the reasons why we have sought the non-permanent seat in the Security Council. If I may, Sir, proceed to the other points which were raised yesterday and not answered. First, I will take the various comments which were made on Singapore-Malaysia relations by Dr Ong Chit Chung, Mr Chiam See Tong, Mr Hawazi and a few others. First, to recap the events since we last discussed the situation in this House. When we recall our last discussion in this House, it was in the context of still fairly strained relations between our two countries. But on that occasion, I did say that there were some encouraging developments to indicate that relations were slowly getting back to normal. I would say that since then there have been further significant developments in our bilateral relations. Members will recall that in September last year, the Malaysian Customs commenced stringent checks on lorries ferrying goods from Malaysia to Singapore and vice versa. An adverse effect of this move was the chronic vehicular congestion at the Causeway that lasted up to one month or so. Fortunately, the situation eased soon after the two Prime Ministers met at the Commonwealth Heads of Government Meeting in Edinburgh in October 1997 and they agreed that both sides should see how this problem should be resolved early. What are the recent developments? Since the two Prime Ministers met in October, they have met on three separate occasions, once in January and twice in February, the latest being 16th February when Prime Minister Goh visited Malaysia in Kuala Lumpur. Prime Minister Goh's visit to Kuala Lumpur was significant in that it took place against a backdrop of the regional economic downturn which has been described as the worst crisis faced by the region since the Second World War. In this regard, our Prime Minister's visit was a useful opportunity to continue with his earlier discussions with Prime Minister Mahathir, the earlier discussions being held a few weeks prior to that in February as well as on 20th January. These discussions were focused on how Singapore and Malaysia could cooperate closely in all possible areas for mutual benefit. Sir, the interests of Singapore and Malaysia are closely intertwined, particularly in the economic area. The contagion effect of the regional financial crisis has underscored this and emphasised the fundamental interdependency between regional countries and the need to cooperate. Our Prime Minister's visit, I believe, reflected the readiness of both Singapore and Malaysia to work towards realising the full potential in our bilateral relationship based on the principle of prosper-thy-neighbour. Sir, the discussions between Prime Minister Goh and Dr Mahathir took place in a warm and friendly atmosphere. And on the whole, the visit was useful for both Singapore and Malaysia because both sides can now build on this for even closer relations. I believe, Sir, that this is a direction in which Singapore-Malaysia relations should continue to develop. The outcome of the discussions between the two Prime Ministers is reflected in a joint communique which was issued at the end of our Prime Minister's visit. That joint communique spells out several areas of proposed cooperation between the two countries, including financial and economic cooperation. It serves also to highlight the commitment by both sides to redouble efforts to resolve several outstanding bilateral issues, such as the long-term supply of water to Singapore, the development of Malayan Railway land in Singapore as well as the dispute over Pedra Branca. As stated in the joint communique, the agreements reached between the two Prime Ministers have laid a firm foundation for both Malaysia and Singapore to cooperate closely in the future. We hope that progress can be made on the outstanding issues. This will help to maintain the momentum in bilateral relations. So in response to the questions posed by Dr Ong Chit Chung and others on bilateral relations, I would say that bilateral relations are back on track, and this is evident from the joint communique. 12.45 pm However, I do not wish to mislead Members into believing that we have solved all the problems. There are still issues that remain to be solved. These issues cannot be solved overnight. However, I believe that our Prime Minister's visit and the discussions between the two leaders have indeed laid a good foundation for further progress to be made on the outstanding bilateral issues. And as Prime Minister Goh said to the press after the visit, it was a useful visit. In this improved atmosphere and common desire to enhance cooperation, both sides, I believe, can now better manage bilateral relations. I have noted what Mr Chiam See Tong has said about the possibility of an economic union between Singapore and Malaysia, a point which he had made previously when he spoke in the debate on the President's Address last year. I understand the basic thrust of his proposal, which is that he recommends closer economic cooperation between Singapore and Malaysia. And as Members are aware, the joint communique issued after the Prime Minister's discussion has indeed mentioned that Singapore and Malaysia will intensify efforts to cooperate in the areas of banking and finance, and all possible areas. Efforts are also under way to encourage mutual investments in the key economic sectors of both countries. This will make Singapore and Malaysia stakeholders in each other's prosperity, to cite the sentiments in the communique I think Members in this House should also know that ASEAN is now working towards establishing a free trade area (AFTA) by the year 2003. At the moment, this is a current priority. However, as for Mr Chiam's proposal of an economic union, and I am no expert on this matter, I have no doubt that my colleague, the Minister for Trade and Industry, would take note of this and give it consideration within the broader context and desire of closer economic cooperation with Malaysia. But we must remind ourselves, as Prime Minister Goh said last year in his reply to Mr Chiam, that such cooperation, of course, takes two willing parties. On the progress of various items in the communique, the officials from both sides, I believe, will meet in the course of the next few weeks to follow up on the various items in the communique. Mr Chiam made reference to the question of the water supply. This has also been dealt with by Minister Lee Yock Suan yesterday, when winding up on the Ministry of Trade and Industry. To that, let me just add that, as reflected in the joint communique, Dr Mahathir had agreed that Malaysia would undertake to continue the supply of water to Singapore beyond the expiry dates of the existing 1961 and 1962 water agreements. This general undertaking will be confirmed in an agreement to be signed within sixty days from the issuance of the joint communique. Officials from both countries, I understand, will be meeting in Kuala Lumpur on or around 9th April to discuss this matter. We had originally sought a full water agreement with specific terms and conditions. Achieving a full-fledged agreement with Malaysia on extending the existing water agreements beyond the present expiry dates of 2011 and 2061 would help not only in dismantling a psychological barrier between our two countries, but replace it with a new framework of cooperation for mutual benefit. However, Dr Mahathir indicated that he was unable to agree to a full-fledged agreement at this point of time. He said that he would also need time to get the backing of state governments, as water is under state control. Sir, lacking a firm agreement that sets out explicitly and comprehensively the terms and conditions for the supply of water beyond the present terminal dates, we will have, of course, to continue to intensify our efforts to find new sources of water supply. This is something, as mentioned on other occasions in this House, we have been actively doing over the years, even though water is not of immediate issue for us. Currently, desalination, of course, remains one salient option among several that are being explored. Let me now turn, Sir, to the comments and questions raised by colleagues on Singapore-Indonesia relations. I would first speak generally about bilateral relations since the House last met in the Committee of Supply. I would say that bilateral relations generally are close and good. Our ties with Indonesia have been built on a strong foundation based on common interest in many spheres. Relations in the past year have been strengthened by regular exchanges of visits. Our Prime Minister and President Suharto have kept up their regular meetings to discuss various issues. In August 1997, some of our Members of this House visited Indonesia in conjunction with their independence day celebrations. This is a good reflection of the broad-based relationship between the two countries. There have also been concrete examples of close bilateral cooperation. One clear example was the difficult joint search-and-rescue-cum-recovery operations in the aftermath of the SilkAir MI 185 tragedy at Palembang in December last year. It was heartening to see cooperation from the ministerial level to the local authorities on the ground. And the tragedy, while I believe we certainly would have wished it had not taken place, had brought our two countries and people closer. But taking the situation as at present, we must recognise that Indonesia is going through a difficult patch. They are facing economic problems and a currency crisis, problems of drought, shortage of food supplies, medicine, etc, and there have also been reports of sporadic unrest. However, general law and order have been maintained. Sir, we, in Singapore, must understand and empathise with these difficulties that the Indonesians are experiencing. We are concerned about the difficulties they face and we will do our best to help them overcome their difficulties. As the Prime Minister has said, it is impossible for Singapore to close our eyes or fold our arms and ignore the problems of our neighbours. We should see these problems in perspective. Taking into consideration factors such as their sheer geographical size and large population, Indonesia would need time to tackle the financial crisis and stabilise its economy. The Indonesian government has to handle many competing priorities, especially during the current economic difficulties. But the problems the Indonesian government faces are not insurmountable. There are two reasons why I say this. First, President Suharto has begun his new term as President and he remains in control of the situation. We are confident that he will make some tough decisions to resolve the current crisis. As Prime Minister Goh said in his letter to congratulate President Suharto which was published recently, "Indonesia had faced overwhelming difficulties and widespread poverty in the past. But through President Suharto's strong will and leadership, Indonesia overcame them." The second reason is that the international community has come forward to assist Indonesia to stabilise its economy and ameliorate some of the impact of the financial crisis. Yes, there may be differences in how the problems could be resolved, but I believe that all concerned parties want to see Indonesia recover from this crisis by adopting the most realistic and rational solutions. Sir, in today's world, we see a series of cross border linkages bringing countries closer together. Strengthening these regional or global linkages will be beneficial for economic development. In that regard, Indonesia is a vital link in that chain for the region and for Singapore. Indonesia is a key strategic player in the region. A politically stable and economically sound Indonesia is therefore important. It is important not only for Singapore, it is important for ASEAN, it is important for the rest of the region and beyond. It is with these considerations in mind that Singapore has offered a contribution of US$5 billion loan to Indonesia, as part of the IMF package. Prime Minister Goh has also proposed a multi-lateral trade finance guarantee facility for Indonesia. This proposal is awaiting responses from countries to which the Prime Minister has written, including the G7 countries US, Canada, Japan, UK, France, Germany, Italy, as well as Australia, Brunei, China, Malaysia, the Netherlands. However, our assistance alone would not be effective. It is therefore important that we work with international and regional institutions such as the IMF, the World Bank, the Asian Development Bank and other countries to assist Indonesia in its economic recovery. We are a small country. Our assistance is within the constraints of our resources, and our US$5 billion loan package and our PM's proposal of a multi-lateral trade finance guarantee facility for Indonesia should be seen in that light. But Singapore can play a catalytic role in proposing workable ideas and getting others to join in doing more to help Indonesia. In other words, we try to play a supportive and constructive role alongside other countries to help restore confidence to Indonesia and to the region. I hope that with the international collective will and cooperation, Indonesia and the rest of the region will emerge out of the regional economic crisis even stronger. I now turn to Dr Tan Boon Wan's comments about the principle of non-interference, and how do we tackle transnational problems that affect various countries. I would respond that we should and indeed we have always abided by the principle of non-interference in the internal affairs of other countries. It is a principle that we should always uphold. But this does not preclude countries from helping one another or formulating new mechanisms, and this was a point Dr Tan Boon Wan asked about new mechanisms. It should not prevent us from formulating new mechanisms to ensure that problems like the haze or the currency crisis do not recur. In this respect, steps have already been taken. On the issue of the haze, for example, Members have heard my colleague, the Minister for the Environment, recently tell the House that the ASEAN Environment Ministers had met to look for ways to solve the problem. Similarly, in the regional financial situation, ASEAN leaders had met in December to discuss the issue. A leaders' statement was subsequently issued. More recently, Singapore has offered its assistance to which I have referred. Other ASEAN countries have similarly provided assistance. The ASEAN countries have jointly sought solutions to the crisis. Under the Manila Framework, six ASEAN countries Brunei, Indonesia, Malaysia, Philippines, Singapore and Thailand together with other Asia-Pacific countries such as US, China, Korea, Hong Kong and Australia have agreed, as Members would have read in the press, on the need for a regional surveillance mechanism for early detection of problems. Sir, there are indeed mechanisms for regional countries to deal with such problems. But to be realistic, I must admit that we cannot guarantee that such problems would not recur as there are so many factors and causes involved. On its part, Singapore will work with the other countries to see how these mechanisms can be strengthened in the future. 1.00 pm Now, I turn to the two related questions asked by Mr Shriniwas Rai about MFA's policy of diplomatic relations. He urged that we have diplomatic relations with as many countries in the world as possible. It is very difficult to disagree with the objectives that he urges upon the Ministry of Foreign Affairs. Presently, Singapore has established diplomatic relations with some 149 countries. I would say our considerations for establishing diplomatic ties are three-fold: first, sometimes we are approached by another government to establish formal diplomatic ties. Second, to do so is consistent with our policy of cultivating a constituency of support from countries which are responsive to our interests at the UN and other international forums. Third, where we do not have significant bilateral relations with other governments, there is merit in cultivating relations. But I should explain to Mr Shriniwas Rai that in today's world of diplomacy, the formality of entering into diplomatic relations is really not a condition precedent, i. It is not an obstacle or a bar to having interactions and having to conduct various relations with those countries. In other words, it is a formality that does not prevent visits, discussions and so on. There are many ways in which this interaction with other countries can be achieved, trade and economic linkages, people-to-people contact and mutual support in international forums. So the fact that we may not have formal diplomatic ties with some countries has never precluded us. Indeed, many of the Foreign Ministers and other leaders have come to Singapore, and some of them are from countries where we do not have formal diplomatic ties. I am not sure whether Mr Shriniwas Rai had in mind the formal act or whether he meant actually establishing a diplomatic presence, which is of course a different thing altogether. Since 1990, Singapore has formalised diplomatic relations with some 52 countries. At the same time, we have developed ties with many other countries with which we have not established the formal act of diplomatic relations. He asked about roving ambassadors. But in asking that question, he was cognisant of the fact that, as a small country, with a developing foreign service, we just cannot have resident ambassadors in many parts of the world. So we establish a non-resident ambassadors or roving ambassadors scheme as a means of expanding our diplomatic representation abroad. When we appoint non-resident ambassadors, we do so after careful selection of suitably qualified candidates. I take his point that we should try to expand and build on this roving ambassadors. We will try to do so, but before the Government appoints more non-resident ambassadors, we must ensure that we have the candidates who can adequately and effectively represent the interest of Singapore in the country of accreditation. I should say that since 1991 we have appointed 14 non-resident or roving ambassadors, and between the 14 roving ambassadors they cover 37 countries in Asia, Europe, Latin America and Africa and the Pacific.