Deepen China, Singapore cooperation for a better future

By Zhang Gaoli, Published The Straits Times, 22 Oct 2013

SINGAPORE is a special and important neighbour friendly with China. The two countries are near each other geographically, share cultural and blood ties, and have common interests and long-standing bilateral ties.

Every Chinese visitor to Singapore is deeply impressed by its garden city, vibrant development and social order.

The Chinese government places great emphasis on developing friendly ties with Singapore. Leaders have maintained close contact and built good working and personal relationships since the exchanges between Mr Lee Kuan Yew and Mr Deng Xiaoping in the 1970s. Both sides have linked development strategy to the bilateral relationship to pave the way for cooperation in which we learn from each other and which is mutually beneficial.

In the 23 years since diplomatic ties were established, bilateral relations have developed rapidly, cooperation has continued to rise to new heights and shared interests have deepened increasingly.

Bilateral trade has grown 24-fold from US$2.8 billion to US$69.3 billion (S$85.9 billion). Visitor exchanges have increased 22-fold from 95,000 to 2.2 million. The number of joint projects is on the rise. The Suzhou Industrial Park and Tianjin Eco-City are role models, followed by the Guangzhou Knowledge City, Sichuan-Singapore Hi-tech Innovation Park and Jilin Food Zone. Like a tree with luxuriant foliage, our cooperation has borne fruits that benefit people from the two countries.

Bilateral ties are at a new starting point in history. Singapore Prime Minister Lee Hsien Loong recently visited China, and met Chinese President Xi Jinping and Premier Li Keqiang. They reached a consensus on deepening cooperation in the new era, setting the direction for promoting bilateral relations.

China has attracted attention worldwide with its achievements in modernisation over 35 years of reform and opening up. With confidence, the Chinese are striving towards realising the China dream of a moderately well-off society and the Chinese renaissance.

China will persevere with deepening its reform and opening up. We will expand the market economy further and let society have more say. We will ease corporate controls, step up our efforts towards a fair and transparent market as well as promote fair competition and survival of the fittest for a vibrant market. We will be more active in opening up and learn from all aspects of human civilisation so that our opening up can be comprehensive in depth and scope.

China will step up the pace of transforming its economy for sustainable and healthy growth. Development remains the key to solving China's problems, but we will no longer focus simply on gross domestic product growth. While maintaining a reasonable pace, we will also try to raise the quality and efficacy of our growth. In order to speed up transformation of the economy from "made in China" to "created by China", we will upgrade our industries, resolve over-capacity and strengthen innovation.

We will coordinate development in various parts of the country, with special focus on the central and western areas. We will make full use of urbanisation to expand domestic demand, promote development and improve the people's livelihood, thereby creating a new engine of economic growth.

China is committed to building an eco-civilisation based on green, low-carbon development and recycling. We want our environment intact even as we pursue wealth. We will get tough on acute environmental issues and through perseverance increase the pace of building a beautiful China with blue sky, green earth and clean water.

China's huge growth potential and bright outlook will offer more opportunities and room for development for countries including Singapore. Singapore is one of the first countries to participate in China's opening up. It has advanced management experience, a developed service sector and is an important international financial hub. All these meet the demands of China's economic transformation, giving Singapore an obvious edge in China's external cooperation.

We are willing to work with Singapore to realise the consensus of promoting stable, deep and pragmatic cooperation reached by our leaders:

- Continue to improve the cooperation mechanism and maintain its stability, continuity and openness. Ensure proper macro-planning in developing cooperation. Deepen cooperation in key areas and iconic projects as models of development.

- Strive to expand areas of cooperation. Strengthen pragmatic cooperation in areas such as trade, finance, technology, humanities, ecology building and social management. Support Singapore's participation in developing China's western and north-eastern parts as new highlights in cooperation.

- Work together to promote regional cooperation. Focus on promoting an Asian infrastructure investment bank, a stable currency, credit system, investment and financing cooperation system and the 21st century maritime Silk Road for early establishment of a comprehensive economic partnership in the region.

"The horizon widens amid a calm river, the sail catches the wind." A rare opportune moment beckons China and Singapore in their pragmatic cooperation. Let us forge ahead and cooperate in good faith for a better future for bilateral ties.

The writer is Vice-Premier of China. This article first appeared in Lianhe Zaobao on Oct 21, 2013. Translated by Ho Cheeng Cheeng.

China, Singapore ink 7 deals to boost ties
Pacts include direct trading between currencies, projects in third countries
By Jeremy Au Yong, The Straits Times, 23 Oct 2013

SINGAPORE and China have started a new phase in their long history of bilateral collaboration by inking new initiatives that would introduce closer financial cooperation and see them work together on joint projects in third countries in Africa and South-east Asia.

The biggest strides forward yesterday - a day when the two sides put pen to paper on seven deals - were the announcements that the two sides will begin trading directly in each other's currencies, and that Singapore will be included in a programme that allows financial institutions here to invest up to 50 billion yuan (S$10.2 billion) directly in the Chinese securities market.

They were among the many outcomes from a morning of high-level meetings chaired by Deputy Prime Minister Teo Chee Hean and visiting Chinese Vice-Premier Zhang Gaoli.

Speaking to reporters after the meeting of the Joint Council for Bilateral Cooperation - the top bilateral body - DPM Teo said that this year's talks were especially significant given that both countries are in transition.

"Both Singapore and China are going through transformations, and China, in particular, is going through a new phase of its development under a dynamic new leadership. Therefore, there are new connections, new types of exchanges that China is seeking to make and there are many opportunities where we can work together for this purpose," he said.

The other two meetings held in the morning were those of the 15th Suzhou Industrial Park Joint Steering Council (JSC) and the sixth Tianjin Eco-City JSC.

The agreements boosting financial links mean that Singaporean businesses looking to deal in yuan would no longer have to first convert their Singapore dollars to a different currency, such as the US dollar. Singapore's inclusion in the Renminbi Qualified Foreign Institutional Investor programme would allow local investors to gain access to opportunities in China.

Said Trade and Industry Minister Lim Hng Kiang: "The big picture is that China is embarking on a very dramatic reform of its economy, and the MTI economic agencies have been working with their counterparts to see how Singapore can weave itself into and support China's reforms."

Among the other noteworthy agreements unveiled was a memorandum of understanding (MOU) signed between International Enterprise Singapore and the China Development Bank to help companies from both countries break into emerging markets, starting with South-east Asia and Africa.

The deal has two planks. The first would involve the sharing of expertise and networks: Singapore will help Chinese companies gain a foothold in South-east Asia while China will do the same for Singaporean firms in Africa where it is already established.

The other seeks to give firms easier access to financing when investing in infrastructure in third countries. Few details were available although officials said it is unrelated to the idea of an Asian infrastructure investment bank mooted recently by Chinese President Xi Jinping.

There were also agreements to start a "smart city" within the Suzhou Industrial Park and an MOU to establish a Trade in Services Working Group, meant to promote exchanges in sectors such as education, health care, finance and urban planning.

Yesterday, Mr Zhang, a member of China's elite Politburo Standing Committee, also met President Tony Tan Keng Yam and Prime Minister Lee Hsien Loong.

He will wrap up his three-day official visit today with a tour of Anchorvale Community Centre and the Sengkang Floating Wetlands.

Direct currency trading 'boosts Singapore's status as yuan hub'
Investors here also get more options to gain from China's growth: Experts
By Yasmine Yahya, The Straits Times, 23 Oct 2013

A MOVE unveiled yesterday by Singapore and China to allow direct trading of their currencies cements the Republic's status as a yuan trading hub, experts said.

The step, along with other measures to free up two-way financial trading, also gives investors here more ways to profit from China's growth story, they added.

The most exciting move for investors here is China's decision to include Singapore in a programme allowing financial institutions here to buy directly into the mainland securities market, up to a quota of 50 billion yuan (S$10.2 billion). This Renminbi Qualified Foreign Institutional Investor programme will also allow these financial institutions to then issue yuan-denominated investment products to investors here.

Banks and asset managers could, for example, help their clients channel yuan deposits in Singapore into China-listed stocks and bonds to get higher returns, while fund managers could package China-listed securities into unit trusts for retail investment.

Nikko Asset Management Asia's head of fixed income, Mr Koh Liang Choon, said this is a timely move, given that offshore yuan deposits here have grown rapidly to over 140 billion yuan by the end of July this year, up 40 per cent from December last year.

Standard Chartered chief executive Ray Ferguson said: "We see a real opportunity for our clients to benefit from yuan appreciation as investors look for new investment opportunities and companies look to diversify sources of funding."

A second move announced yesterday will potentially allow Chinese investors to play in Singapore's capital markets. China will consider Singapore as one of the investment destinations under a new Renminbi Qualified Domestic Institutional Investor scheme.

"Capitalising on its position as a leading offshore hub for international and private banking, asset managers in Singapore will be able to advise customers in China on their investment strategy for onshore products here in Singapore," said HSBC Singapore chief executive Guy Harvey-Samuel.

Lion Global Investors chief executive Gerard Lee added: "Mainland Chinese investors view Singapore as a safe haven for their investments, similar to how Europeans view Switzerland during the European crisis of the last few years. Singapore equities will provide a good destination for safety and upside potential."

The introduction of direct currency trading will lower currency conversion costs between the Singdollar and yuan, bankers said, further propelling the growth of bilateral trade and investments.

It will especially benefit Singapore firms, said Ms Lum Yin Fong, head of global product management at DBS Bank's global transaction services unit. "With the establishment of a direct yuan trading link, a Singdollar-yuan benchmark reference rate will be made available by the People's Bank of China on a daily basis. This will benefit Singapore corporate customers hedging their yuan, as it will provide them with an official benchmark to refer to."

Khaw Boon Wan confident on outlook for Tianjin Eco-City
By Jason Ou, The Straits Times, 23 Oct 2013

TIANJIN Eco-City may have been slow getting off the ground, but National Development Minister Khaw Boon Wan is confident that growth will soon speed up.

Speaking to reporters about the key Singapore-China project yesterday after the meeting of the sixth Tianjin Eco-City Joint Steering Council, Mr Khaw said it was no surprise that few people have moved into the area, given its location away from population centres.

But he emphasised that leaders on both sides were still invested in the project.

"Don't forget Tianjin Eco-City is only five years old," said the minister.

"Now, the population is about 6,000, (which) seems like a very small number. But the growth rate from now on will be quite rapid. Those of you who went there five years ago, I think you'll be amazed at the transformations," he added.

Singapore and China broke ground for the joint project - their second after the Suzhou Industrial Park - in 2008, aiming to make it a model of sustainable development.

But its lack of appeal has caused concern. So far, it has attracted only 6,000 residents, in a start-up area of 3 sq km. That is well below the target of 10,000 hoped for by the end of last year.

The Eco-City, part of the coastal city of Tianjin, 150km from Beijing, is expected to house 350,000 people on 30 sq km when it is completed around 2020.

Achieving that will take time, said Mr Khaw, considering the "green field project" was deliberately located "in an area quite disconnected from the rest of the population centres".

"Connectivity is always a major issue, because without that transport infrastructure, it's very difficult to persuade people, to say 'why don't you move and live in the place'," said Mr Khaw.

"We had similar experiences in Singapore. When you create a new town, you have to put in the infrastructure."

Construction of a proposed light rail linking the Eco-City to downtown Tianjin 40km away has yet to begin.

But Mr Khaw said he was assured by Chinese Vice-Premier Zhang Gaoli, who co-chaired the meeting with Deputy Prime Minister Teo Chee Hean yesterday, that "a major regional connectivity plan" is under consideration. It may include highways and high-speed rail.

Leaders from both countries also discussed the next five-year plan, said Mr Jiang Weixin, China's Minister of Housing and Urban-Rural Construction.

Said Tianjin mayor Huang Xingguo: "We're full of confidence in the next five years."

The Eco-City has attracted more than 1,000 companies with a total registered capital of 78 billion yuan (S$15.9billion) in the last five years, the Tianjin Daily reported last week.

More investment will draw more residents, noted Mr Khaw.

"Without the factories, without the companies, without offices, without jobs, why should people move there? You know, this is not a resort town," he said.

"Therefore, there were some discussions about tax incentives, particularly of the kind that will attract green technology."

Chinese leader tours heartland facilities
Anchorvale visit also gives Chinese citizens chance to meet Vice-Premier
By Jeremy Au Yong, The Straits Times, 24 Oct 2013

A HANDFUL of Chinese nationals - with toddlers in tow - turned up early at Anchorvale Community Centre yesterday, hoping to catch a glimpse of visiting Chinese Vice-Premier Zhang Gaoli.

They did not go home disappointed.

Before the Chinese leader began his tour of the community centre, he chatted briefly with the women and posed for pictures, even obliging Ms Liu Yixia, 59, who urged him to hold her 2 1/2-year-old grandson.

Another Chinese national who turned up was Ms Cheng Kai, 62, a retiree looking after her grandchild in Singapore. "In China, I would have never got a chance to meet him," she said.

Post by Ministry of National Development.

After the impromptu meet-and-greet, Mr Zhang was given a quick briefing on the People's Association, the community centre and adjoining park. He also dropped in on a kindergarten class and a taiji session.

Part of the reason for the tour was to show him Singapore's community facilities and its efforts at sustainable development. Senior Minister of State for National Development Lee Yi Shyan accompanied Mr Zhang on the tour.

The Chinese leader applauded Singapore for having facilities where people of all ages could gather, noting that many facilities in China tended to focus on activities for specific age groups.

Yesterday was the last day of what has been a busy three-day official visit for the Chinese leader.

On Tuesday, he and Deputy Prime Minister Teo Chee Hean co-chaired a series of meetings concluding with a raft of agreements between the two sides.

Some of the biggest announcements were made in the area of financial cooperation, where Singapore and China agreed to start trading directly in each other's currencies and a move was made to include Singapore in a programme that would allow financial institutions here to invest up to 50 billion yuan (S$10.2 billion) directly in the Chinese securities market.

During his trip, Mr Zhang also called on President Tony Tan Keng Yam and Prime Minister Lee Hsien Loong.