• In his annual policy speech, Lee stressed Singapore’s strong security ties with Washington and the country’s strong bilateral relations with Beijing based on a shared heritage
  • The leader also addressed a slew of other issues, including the city state’s looming recession, an increase in the retirement age, and long-term climate change efforts
Singapore Prime Minister Lee Hsien Loong. Photo: Reuters

Singapore's Prime Minister Lee Hsien Loong on Sunday said the city state would resolutely stick to its policy of maintaining good ties with the United States and China even as the two major powers remained at loggerheads.

He acknowledged the difficulty the Lion City was facing in maintaining that neutral position because of pressures for the Chinese-majority country " which has significant security ties with Washington " to pick a side.

"Being a Chinese-majority country can at times put us in a difficult position, because our words and actions may be easily misunderstood," Lee said in his National Day Rally speech, an annual policy address.

In the wide-ranging speech " delivered in Malay, Chinese and English " Lee addressed a slew of issues, including a multibillion dollar "50- to 100-year plan" to fortify the island nation from rising sea levels, a staggered increase in the official retirement age, and significant increases in financial aid for preschool and tertiary education.

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"If we support China, the US and other countries may think we do so because we are a majority-Chinese country and therefore accede to China," the leader said in his Chinese speech.

On the flip side, if Singapore backed Washington, China would also misunderstand the Lion City's motives.

Said Lee: "In fact, on occasions when Singapore and China have held different views in the past, some of our friends from China have asked us: 'Since we share a common language, a common ancestry and a common heritage, why does Singapore not share a common view?'"

The path forward therefore was for the city state to "always be principled in our approach, and not swayed by emotions", he said.

If the situation gets much worse, we will promptly respond with appropriate interventions to sustain the livelihoods of our workers.Lee Hsien Loong, on the tariff war

The premier stressed Singapore's strong security ties with the US, pointing out that the Lion City buys advanced equipment from the Western superpower, and that the Singapore Armed Forces regularly exercises with American troops.

Investments by US companies in Singapore are higher than those from any other country, he said.

With China, Lee said Singapore's status as the world's only sovereign nation with a majority ethnic Chinese population, apart from the Asian power, had helped foster bilateral relations because of a shared heritage and culture.

He also cited the city state's deep economic ties with China " with the two countries helming three major joint projects on the mainland.

Lee acknowledged the ongoing tariff war was hurting Singapore's economy. Photo: AFP


On the domestic front, Lee acknowledged the ongoing tariff war was hurting the economy, especially its manufacturing and electronics sector.

The government expects GDP growth to come in at 0 to 1 per cent this year.

Lee said the country's National Trades Union Congress, which has strong ties with his People's Action Party (PAP), was in talks with the government on contingency measures, but that for now, retrenchments and overall unemployment remained low.

The prime minister did not rule out a fiscal stimulus package.

Lee said: "If the situation gets much worse, we will promptly respond with appropriate interventions to sustain the livelihoods of our workers … We are prepared. We have experienced cyclical downturns like this in the past, and we are confident we can take this one in our stride."

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One of the major policy announcements of the speech was the phased increase in the country's retirement age from 62 to 65.

Additionally, employers who are currently required to offer eligible workers the option to stay employed until they are 67 will by 2030 have to keep that option open until employees turn 70.

The withdrawal age for the Central Provident Fund " a hot button political issue owing to fears the government may push back the withdrawal age " will not change, Lee said.

Workers can withdraw the first tranche of their CPF funds at 55 if they are eligible, and receive a monthly payout from age 65.

Lee quipped, to roars of laughter, that anyone who said otherwise was spreading "fake news" and should be dealt with by the country's recently passed anti-fake news law.

Most parts of Singapore are no more than 15 metres above sea level. Photo: AFP


Also in focus was the country's plans to combat climate change, in particular, rising sea levels. Among the proposals Lee mooted was a plan to build Netherlands-style polders to safeguard the main island of Singapore.

Most parts of the island nation " which is smaller than Hong Kong " are no more than 15m above sea level.

He estimated these efforts could cost up to S$100 billion (US$72.2 billion) over 50 to 100 years. The threat of climate change needed to be treated in the same manner as a threat to sovereignty, Lee said.

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"Both the SAF (Singapore Armed Forces) and climate change defences are existential for us. These are life-and-death matters," he said. "Everything else must bend at the knee to safeguard the existence of our island nation.

"With the SAF, we hope never to go to war … But with climate change, we know for sure sea levels will rise. And the only uncertainty is whether they rise a few decades earlier, or a few decades later."

Lee said the next few years were likely to be "demanding" for Singapore.

He is widely expected to call a general election in months " with pundits predicting polls in the first half of 2020 " and has previously said he will hand power to his named successor Heng Swee Keat, the deputy prime minister, some time after the vote.

Lee, 67, the eldest son of Singapore's late founding prime minister Lee Kuan Yew, has been in power for 15 years. He took over from the elder Lee's successor Goh Chok Tong on August 12, 2004.

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