Bloomberg: China’s Focus Is to Jump Start the Economy: Balakrishnan

Singapore Minister for Foreign Affairs Vivian Balakrishnan discusses the takeaways from China’s National People’s Congress, the priorities for the country and China’s role in the region. He speaks exclusively on Bloomberg Television.
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Transcript

How was Xi Jinping is embarking on beggars leadership shakeup in years? Some say that means greater stability at home, but that means that he’s open to taking on more risk abroad. Are we about to see a more aggressive China? Well, I just returned from beating just

The week before. First what I saw when I arrived. Traffic jams. Good sign the economy is back. And I think their focus at this stage really is to restart, read, jump, jump, start the economy and get back to, as you know, to pre pandemic levels.

I my sense of it, that’s part priority number one. Now, clearly, they’re also aware that the world is not in a placid, calm state. And prime of which, no hot war in Ukraine, the shopping rivalry with the United States. And don’t forget, globally, we’re still dealing with inflation, food and energy

Crisis. There’s a lot on their plates. But my sense and certainly the sense from Southeast Asia, it’s the economy that’s number one. But defense is also priority. Over the weekend at the NPC, we saw how China increase its defense budget by seven point two percent. Two hundred and twenty billion dollars

On top of the 7 percent increase the year before. Surely this is a China that has plans. And how will the rest of Asia respond? I would take a step back and to see that actually the last seven, eight decades

Of the peace dividend after the Second World War is over and you’re going to see increased defense expenditure in literally all over the world, certainly in the case of Europe. America still spends more than anyone else, several times more than even China, even IBEX. Yes. So even if the Chinese increase, it’s

Still a fraction of the United States. So my sense is, yes, I see increased defense expenditures all round. I see this merely as an index of the fact that the post called the post-World War Two peace and prosperity that we

Almost took for granted is over. But might we see an arms race in Asia? Asian economies may want to respond to China’s greatest spending in defense. I expect to see greater expenditure all around, including within Asia. But my point is to recognize the reasons behind this.

You know, the rules based world or the focus on economic integration, liberal economics, free trade, all that was a formula for peace and prosperity. And now that the faith in those pillars have been shaken. Seen people. It’s a flight to safety and. And they’re beginning to have to invest more in defense.

So not necessarily an arms race. I don’t think anyone wants to see an arms race which subtracts from the ability of Asia to invest in infrastructure, connectivity, productive capacity, education, training. So long as you don’t erode into those things, I’m not going to worry excessively. I’m going to take this as part and

Parcel of the way the world is evolving. You just back from New Delhi. We did not see a communique yet again. Yes. Talks derailed by the war in Ukraine. China has come out to say it wants to be a neutral moderator. It’s come up with a peace plan.

Can China play that role? I don’t think China is overstating its role. What China the Chinese is. On one hand, Russia is a key ally, partner of China. And China does not want to see Russia crushed or destroyed in any significant way. On the other hand, the Chinese have

Always emphasized that for them, the UN charter, the respect for territorial integrity, sovereignty and independence are also secret. So they are also having to very carefully navigate these sometimes contradictory, geo strategic precious. So to the extent, if you ask me, does China want peace in Ukraine? Yes.

Do they want a better relationship with Europe? Yes. Do they hope to try to dial down the tension with the United States? Yes, they do. Also is raising the tensions in the South China Sea that’s forcing the likes of the Philippines to gravitate closer to the US.

I mean, it was always maintained that it does not want to choose sides. But with rising tensions between the U.S. and China, might countries in this part, it will be forced to do it. Where are you feeling the pressures? Well, first of all, I would say,

Fortunately, in the case of Singapore, we have no claims in the South China Sea. That’s one big pain point that’s not present for us. Second, the consistent position seeing points taken in fact for decades is that actually this is an area where China can

Afford to be and should be more generous to the smaller, weaker states in Southeast Asia. Again, territorial disputes on sovereignty may take generations to resolve. But can we, while not giving up claims, can we in the meantime focus on the economy? And should China be doing more in terms

Of trade, investment and connectivity? And in fact, China has been trying to do so. So I’m not trying to trivialize, you know, that the tensions in the South China Sea. But what I’m saying is that if everyone can keep calm, less drama and focus, follow the money. I think that will be helpful.

So even if you look at Southeast Asia, what is it that even the claimant states won for the Cleveland states, their territorial disputes in the South China Sea? Just one aspect of a much larger and broader relationship with China. They want peace. They want Chinese investments. They want Chinese trade.

We need to find a way to do so.

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