Below is the transcript of a CNBC Exclusive interview with Chan Chun Sing, Minister for Trade and Industry, Singapore. If you choose to use anything, please attribute to CNBC, Sri Jegarajah and Martin Soong.
Sri Jegarajah (SJ): The recovery from the pandemic is just one of the many topics being discussed at the Singapore Summit. And let’s bring in Chan Chun Sing now, Singapore’s Minister for Trade and Industry, who’s going to talk to us about the health of the Singapore economy and the outlook. Minister, thank you very much indeed for joining us this morning. First of all, when you look at the NODX number for August, it looks pretty constructive. Do you believe those kinds of numbers can be sustained in the months ahead?
Chan Chun Sing (CCS): That, Sri, that very much depends on the recovery of the global economy. We have always said that there are three sets of factors that will affect Singapore’s economic growth in the coming months, two of which is under our control, and one of which is not under our control. The two factors under our control, basically, number one, our domestic recovery, which is picking up pace as we control the number of infections in the country. The second thing that’s under our control is our efforts to pivot the old businesses into new business models to capture new markets. But the greatest uncertainty will be the global economic recovery. And we fear that the growing pandemic in other parts of the world will affect the global recovery, and that will have a knock-on impact on the Singapore economy.
SJ: So on balance Minister, do you think that there is downside risk to Singapore’s economy in the months ahead and as we head into 2021? And do you have a working assumption at the ministry on when Singapore’s economy does finally return to pre-pandemic levels?
CCS: We expect to progressively recover for the last two quarters of this year, but whether we will be in the clear by next year very much depends on the global economic performance. So for us, we will continue to diversify our markets and pivot into new products and services. So we are not waiting for the pandemic to blow over and waiting to go back to the previous good old days, as they call it. We are starting now to make sure that we pivot to a new model to make sure that we put ourselves on a much more sustainable footing. And that I think will allow us to get back on a positive footing as soon as possible.
SJ: Minister, can you tell us whether Singapore has broken the back of a potential second wave risk in the pandemic? Do you think that is off the table now?
CCS: No, Sri, we are eternally vigilant. We have learned from the experience of other countries that if you let your guard down, something might just hit you very badly and very quickly. We have never let our guard down. And we are progressively reopening more and more economic activities in a controlled and sustainable pace.
Martin Soong (MS): Minister, this is Martin, great to see you again and to have you back on the show. If I could talk about the world’s busiest land border crossing – Singapore-Malaysia – of course. The latest news is that Malaysia is willing to consider opening up that border between Singapore and Malaysia by early next year by January there. What is the government’s position on this, obviously would theoretically be welcome but are both sides ready for it?
CCS: We are working very closely with our Malaysian counterparts to see how we can resume travel. As we speak now, the essential business travel – the trucks that bring the logistics in and out of the country – they are continuing well. So we are continue to make progress depending on the situation on the Malaysian side of how they want to, what they are comfortable with.
MS: Would the government be amenable even if it included quarantine measures on both sides, or would that just be not doable and, and not practical?
CCS: Well, Martin, actually, as we reopen our borders with different countries, they all come with varying forms of health assurance measures. So we do this not just with Malaysia, but we are also progressively opening our borders with other countries, some unilaterally, some with reciprocal green-lane arrangements, but whatever the case is, we take a risk-based approach. And we will continue to push the boundaries for us to progressively resume our links with the rest of the world in a controlled manner and in accordance with the prevailing medical conditions of those countries that we are working with.
MS: Okay, sounds wise to me, Minister, if we could go back specifically to your space, your portfolio, a trade and the latest NODX numbers. We mentioned just when it came to you that there was a huge jump of more than 55% in exports of non-monetary gold out of Singapore. Came as a bit of a surprise. I mean, we’re used to hearing about exports of, let’s say, biopharma etc., being very strong. But non-monetary gold? Explain this to us and for our audience, just very quickly.
CCS: I think Martin we shouldn’t be overly seized with the numbers at any one point in time. For us, we look at longer trend numbers, which I think is more important, because at this point in time, with the reshuffling of the global production and value chains, that will require a lot of instabilities in the numbers and the statistics. But what is more important for us to focus on is the longer term numbers on the trend basis. And on that basis, we are confident that we are progressively recovering in tandem with the global economy, and we’ll continue to make efforts domestically to make sure that we keep our situation – our health situation – in good shape so that we can ramp up the domestic activities and continue to pivot to new markets and products and services.
SJ: Minister, that’s one area of the export story that’s been performing quite strongly and that’s the pharmaceutical sector. And I’m just curious what part of the global push to develop an effective vaccine is Singapore’s pharma sector playing. Can you give us some color on that?
CCS: Well, as a backdrop, we have strong biopharma medical sector. So, we have many of the prerequisites to produce medical products in service of the global markets. On the specific question of the vaccine, we are in talks with various producers, and production of the vaccine will require different parts of the value chain to come together. And we hope that Singapore can play an important part in this value chain. It can be for example, in the field and finish part of it, you can be in the distribution part of it. So there are different parts of the value chain that we are in talks with the potential suppliers of the vaccine in service of the regional and global markets.
SJ: And Minister as we all know, this pandemic has had a profound impact on commercial airlines, not least of all Singapore Airlines, SQ, our flag carrier. How would you describe its health at the moment? And are there more retrenchments coming and what can be done to help those workers who have lost their jobs at Singapore Airlines? What is the future of the carrier?
CCS: So Sri, there are a couple of things that we are doing to help Singapore Airlines and its workers. First and foremost, we must make sure that we progressively reopen our borders. So we are working very hard and bilaterally with various countries to resume air services with mutual assurance. So that’s the most important because that brings in the topline for Singapore Airlines. The second part is that as SIA consolidates its capacity, we are determined to help them preserve their capabilities that have been built up assiduously over many years. So it’s a period of consolidation but we will make sure that the core capabilities are maintained within the organization. Third, we are going to help the workers who have been displaced to find alternative employment in adjacent sectors or in other new sectors depending on their aspirations.
MS: Minister, Singapore obviously is a global financial center. It also happens to be a very important oil trading center. You’ve been on record saying that you would like to see more LNG, liquid natural gas, trading desks in Singapore. Given the recent history of a lot of oil trading bankruptcies, a lot of outfits going bankrupt in Singapore, are you confident that there are extra or additional measures in place to make sure that something similar doesn’t happening there is a proliferation of more LNG trading desks?
CCS: Martin it’s not just about LNG trading gas, or gas trading in Singapore. Actually, Singapore is a trading hub and our portfolio of tradeable, if you like, extends well beyond LNG. And why many people have set up their trading hubs in Singapore in service of the region and the world is because of our ability to have coherent and consistent policies over the long term. We are determined to make sure that any traders that come into Singapore is able to connect with the rest of the world. In terms of connectivity, both physical and non-physical connectivities, we’re determined to give them a clear rule of law for them to have a transparent and open system to work with. And these are the advantages that allow Singapore to become a trading hub not just for LNG, but including for many other products including agricultural products, not just for the Singapore market, but always for the region and the world.
SJ: Minister, can you say with certainty whether Singapore has eradicated the COVID clusters and the potential clusters in the foreign worker dormitories and what guarantee can you offer that accommodation for these gentlemen – living conditions and working conditions – are safe in this COVID environment?
CCS: Sri, as I mentioned, we are never complacent. We will never claim that we have eradicated COVID, whether in the dorms or outside in a community. It’s a running battle to make sure that we stay on top of the things, stay on top the situation, and making sure that we are vigilant. So we continue to improve the living conditions of our workers in the dorm and also continue to ensure that the safe distancing measures, the safe management measures out in the communities, are adhered to. So it’s a whole community effort. The migrant workers are part of our community and we will work closely with them to make sure that they are well taken care of. And we also want to make sure that the community is well taken care of. When the entire system is well taken care of only can we be more assured that we can open up even more sectors of activities.
MS: Indeed, and understood Minister, always great value talking to you. Thank you so much for your time this morning. Keep safe and hope to talk to you again very soon. Chan Chun Sing, Singapore’s Minister for Trade and Industry joining us live.
END
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