World

Singapore can be a global financial hub for Belt and Road Initiative

Minister in the Prime Minister's Office Chan Chun Sing on China's One Belt One Road initiative at World Economic Forum

Singapore can play a critical role in the China-led Belt and Road Initiative (BRI) as a global financial hub, providing the banking and legal support for projects, as well as facilitating in the "software transfer" to ensure projects are sustainable once completed.

This was spelt out by Mr Chan Chun Sing, Minister in the Prime Minister's Office and NTUC chief, yesterday to an audience of top business and political leaders, during a session at the World Economic Forum on the One Belt One Road initiative, a showpiece project of China's President Xi Jinping.

Noting that Singapore was happy to be working closely with China on this major initiative, Mr Chan added that Chinese officials often pointed to the 33-85 figure to remind their Singapore counterparts of the role the Republic plays.

This refers to the fact that 33 per cent of all outward investments related to the BRI flows through Singapore, while 85 per cent of inbound investments for the initiative makes its way into China through Singapore.

As a major financial hub, Singapore was able to do this, syndicating loans while also providing the legal framework for them, and also ensuring the transfer of management know-how to the local community.

He was speaking on a panel discussion organised by Chinese media group Caixin and included Pakistan's Prime Minister Shahid Khaqan Abbasi, Asian Infrastructure Investment Bank president Jin Liqun, and business leaders from China, Russia and the United States.

On how BRI projects might benefit local communities, Mr Chan said that these should aim to be economically viable and sustainable to begin with.

In the mid-term, these should aim to be catalytic, uplifting communities by adding to their capacity, including the ability to take over and successfully manage projects and build on them once the foreign partners have moved on.

For the longer term, the projects should try to show the kind of power that China aimed to be in the world, one that seeks to use its power and position to build a global system that is inclusive and benefits societies around the world, he said.

If China could use its growing power to do this, it would "win the trust and confidence of the world", he added, pointing to the phrase "yi de fu ren" mentioned by President Xi when he delivered a well-received speech in Davos last year.

This refers to using one's abilities in a benevolent way to benefit the community.

This, he argued, was the underlying philosophy of the BRI, as he saw it.

During the hour-long discussion, Mr Chan also cited the example of the Suzhou Industrial Park project, jointly developed by China and Singapore in the 1990s.

What was more important than the physical structures of the industrial park was the intangible "software transfer" that took place behind the scenes.

Mr Chan likened the work on the BRI to that of a bricklayer.

His effort could be described as simply setting down a brick or, alternatively, as part of an effort to build a wall.

But from another perspective, that same effort could be viewed as part of a longer term vision to build a cathedral, he said.

Mr Chan added that he believed China's leaders had the wisdom to view the BRI as a contribution to building an inclusive global order that benefits the world in the long run.

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BUSINESS & FINANCE