March 15, 2006 | Volume 3, Issue 1
Singaporean Interests and the People's Republic of China
Purpose This memorandum urges the Singapore Government to
- Continue to engage the People’s Republic of China (PRC) constructively;
- Expand its trade and economic links with the PRC; and
- Recognize PRC‘s poor human rights records but advocate PRC‘s economic growth as a way to improve the situation.
Threats and Opportunities Regarding the People’s Republic of China
PRC‘s Poor Human Rights Record Presents Threats
Many companies and individuals in the Singaporean business community have expressed their concerns about the possibility of economic trade sanctions against the PRC over its poor human rights record, and the effects of such sanctions on Singapore’s investments in the PRC. As recently as December 2005, an influential U.S. senator had threatened trade sanctions against China for its treatment of North Korean refugees1. Multiple sources, including the U.S. State Department and groups like Amnesty International and Human Rights Watch, also regularly report the PRC‘s abuses of human rights2. Any economic sanctions against the PRC will hurt Singapore’s substantial investments in the PRC. According to a survey by Singapore Statistics, Singapore’s direct investment in the PRC amounted to $19 billion in 2003, or 12 percent of Singapore’s total direct investment abroad3.
PRC‘s Strong Economic Growth Introduces Opportunities
Over the past several decades, the PRC has become an economic powerhouse. Between 1994 and 2004, the PRC‘s GDP growth averaged close to nine percent annually (see Chart 1), significantly higher than the world’s GDP growth of 5.1 percent in 2004, which was the strongest in three decades4. This growth introduces tremendous economic opportunities for Singapore.
Figure 1: China’s GDP Growth Rate
Policy Options Available to Singapore
Option One, Singapore Joins the Western Democracies
Given the western democracies’ strong sentiments for tough action against the PRC, Singapore may be tempted to join them in calling for the PRC to end its human rights abuses. While doing so will get Singapore into the good favor of western democracies, it will also hurt Singaporean interests in the following areas:
- Singapore’s bilateral relations with the PRC will suffer. The PRC may cut some of its economic ties with Singapore and as a result, hurt its investments in the PRC;
- Singapore’s participation in any economic sanctions against the PRC will also hurt its investments there; and
- Singapore will not be able to reap the potential opportunities of economic growth in the PRC.
Option Two, Singapore Sides with the PRC
A second policy option is to side with the PRC by speaking out on its behalf against western critics of PRC‘s poor human rights records. This should allow Singapore to protect its investments in the PRC and reap the opportunities from the economic growth there. However, this option has the following drawbacks:
- Singapore may be viewed by the western democracies as a supporter of human rights violations. As a result, its economic and trade links with other countries will be affected.
- Any economic sanctions against the PRC will also hurt Singapore’s investment there. As a Chinese proverb goes, “When a city’s gate is on fire, the fishes in the nearby ponds will suffer as city dwellers use the pond water to put out the fire”; and
- Singapore may be viewed as a “lackey” of the PRC. This will erode Singapore’s reputation as a credible international player.
Option Three, Singapore Takes an Independent Stand
A third policy option is to adopt a pragmatic approach by:
- Engaging the PRC constructively;
- Expanding its trade and economic links with the PRC; and
- Recognizing PRC‘s poor human rights record but advocating PRC‘s economic growth as the best way to improve the situation. Economic growth will eventually grow the middle class, and over time the middle class will be a vocal force wanting to improve the human rights record of the PRC.
Some nations may ridicule this approach as “sitting-on-the-fence.” It will, however, serve Singapore’s interests well in the following areas:
- Singapore can benefit from the opportunities presented by the PRC‘s spectacular economic growth;
- Singapore will maintain its credibility in the conduct of foreign policy by not taking sides with any bigger nations; and
- Singapore will be seen as a country that does not ignore human rights in the pursuit of economic interests.
The Preferred Option
Evaluation of these options indicates that policy option three will provide the most desirable outcome for Singapore. In addition to the reasons already given, it should be noted that for a small country such as Singapore, it is very important to expand the international space in which it can maneuver. Taking sides with any particular nation will limit such space and be detrimental to Singaporean interests.
While some states or organizations may criticize Singapore for not doing more to improve the human rights situation in the PRC, any sustainable improvement in the PRC‘s human rights record must come from within the country. The most feasible way to assist in that improvement is to grow the PRC‘s middle class through greater economic development and constructive engagement. Over time, the PRC‘s middle class will become strong both economically and politically. When this happens, the middle class will demand greater respect for their rights. The PRC, responding to such internal pressures, will naturally improve its human rights record5. Outside pressures, on the other hand, will likely lead to greater oppression, much like the situations in Myanmar6 and North Korea7.
Conclusion
In conclusion, protecting and growing Singaporean investments in the PRC is crucial to economic prosperity. Moreover, helping the PRC grow economically is the best way to encourage the PRC to improve its human rights record. Finally, small countries such as Singapore must remain credible by not appearing to concede their interests to other major power states. Consequently, the most beneficial strategy for Singapore is to constructively engage the PRC, expand its economic links with the PRC, and recognize the PRC‘s poor human rights record while advocating for their economic growth as a solution to this problem.
1 Refugees International website at http://www.refugeesinternational.org/content/article/detail/6406?PHPSESSID=5ce00f92779c166324e1d.
2 Wikipedia.org – The free encyclopedia.
3 Singapore Statistics â Singapore Investment Abroad 2003.
4 World Bank 2005.
5 There are already signs that the PRC is becoming conscious of its human rights records. In a recent demonstration in Dongzhou, the PRC admitted to its use of excessive force and arrested the police commanding officer (Economist.com, “A demo turns bloody”).
6 Hadar, L. T. (1998). US sanctions against Burma: A failure on all fronts. Cato Institute.
7 Henriksen, T. H. (1998). It’s time to end sanctions against North Korea. Hoover Institute.