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TRANSCRIPT OF MINISTER MENTOR LEE KUAN YEW’S INTERVIEW WITH THE COMMONWEALTH MAGAZINE, 13 JUNE 2006

李光耀採訪記錄

Q: To the small-scaled economies, such as Taiwan and Singapore, what are the impacts of globalization? How should we react to the challenges?

A: It is not about small or big. It depends on where you are placed and how quickly you can adapt to it. Larger countries like France or Germany, placed in the EU believe they are buffered from the change brought by globalization, so they are reluctant to change. Therefore, the pressure builds up, economic pressure, unemployment, and the lack of job creation.

It is really a question of whether you are favorably placed or unfavorably placed. The first lesson we have to get our people to understand is that if we do not change, we will suffer brutally. Singapore is unfavorably placed. Singapore is completely open and small. Our imports and exports are three and half times of our GDP and which means we depend on the world, not on our domestic demand. We do not have the choice. The world chooses for us. We have to change.

Taiwan is not so exposed like Singapore. Taiwan is more viable, and the exports and imports of Taiwan are about 100% of GDP. But Taiwan also has to change. If Taiwan does not change, does not face the reality of the new competition from China joining the global market, Taiwan will lose. As Japanese, Koreans, Singaporeans, and Hong Kong people move to China, then Taiwan will lose the cheap production advantage.

One of the reasons why Taiwan is not doing as well as it can do is that Taiwan put a restraint on itself and is not adjusting to the reality. Taiwan has since Lee Teng-hui, 1988, insisted on no three direct links between China and Taiwan policy. This increases the cost of transportation of goods and the burden on businessmen. It is an irrational decision.

I went to Korea recently. Almost every other businessman I met has business in China. There are over 46,000 Korean students in Chinese universities or studying Chinese. Some are working for their father’s businesses, or pursuing their own future. Taiwan has to compete with Korea. This is the reality Taiwan has to face. Korea makes TV sets and so does Taiwan; Korea makes computers and so does Taiwan. If Taiwan gives your businessmen a handicap, there will be a price.

Q: There seems to be a division between the businessmen and the general public in Taiwan. Most of Taiwanese businessmen moved to China. The problem with Taiwan now is for the people who cannot move. The ordinary people who have to find jobs in Taiwan and politicians their voters are in Taiwan.

A: That’s the hollowing out problem and it is not special in Taiwan. It is happening in Singapore, Europe, Korea, and Japan. Singapore is losing the low-end factory assembling jobs to China, India, and Vietnam. The Japanese redesigns jobs, and Taiwan must do the same.

Supposing Taiwan immediately lifts all the restriction on China tourists, Taiwan will have a few million tourists. Suddenly you will find the hotels are full, the restaurants are full, the shops are full. That happened in Hong Kong. Hong Kong was in depression before and Mainland just came to their rescue. With tourists from China and goods entering China without tax, Hong Kong recovered from depression.

Whether or not you are going to remain ROC for five, ten, fifteen, or even fifty years, that is not in Taiwan’s hand. That is in the hand of what happens in China and what happens in US. They will decide Taiwan’s future.

I told Chen Shui-bian, that just like me, he cannot decide what will happen in fifty or sixty years. If he makes a false move, he will bring tragedy to himself and Taiwan.

Singapore has our own defense forces. Whether Singapore will be able to live peacefully in Southeast Asia depends not on Singapore alone, but on a balance of power which enables international rules to be observed. It depends on the UN Security Council, US, Japan, and other big powers. Now China has the interest to engage in this region. Our defense forces can defend Singapore against a sneak, sudden attack. But, if the enemy puts us under siege and blocks the Malacca Straits, how can we survive?

The destiny of Singapore depends on the international condition. Taiwan’s survival also depends on the international situation. Taiwan should concentrate on making life better in Taiwan. Chen has his own ideas and his ambitions.

Q: State failing is a popular issue now. Like Taiwan, many governments around the world are experiencing problems. What can we do if the state is failing? Where is the hope coming from?

A: The state is failing because some of the basic problems you are facing are not being confronted and addressed. Peripheral issues like changing the name of Taiwan or the president’s aircraft stopping at Lybia, Abu Dhabi or Dubai is irrelevant. The crucial thing is that this is a new world. After the Cold War and Soviet Union’s dissolution, China joined the WTO, India is liberalizing, Eastern European and Central Asian states have also joined the world economy and are looking for investments. All these brought opportunities, difficulties and challenges.

The opportunity is that you can go to those markets to invest and to sell computers, electronic equipments, wafer fabs etc. It also brings challenges because the wages there are so low. They will draw investments from other countries that would otherwise would invest in your country. This is a worldwide problem, not just for Taiwan.

How do we adjust? Each country must decide what is the way to move forward. Between the opportunities and the losses, you try and create more opportunities, otherwise you will lose. There is no other way.

Singapore moves into the areas where China and India are still unable to move in, such as intellectual property and pharmaceutical products, which now is a big industry in Singapore. We are investing in R&D with big companies, bringing renowned researchers to help us start quickly, and having our own PhDs to join them and learn from them.

Western pharmaceutical companies make drugs effective for western people. When we bring the drugs to Asia, they have to adapt and change them for Asians. We have good hospitals to test out the medicine to make the necessary changes. In this way, we make a new living which did not exist 10 years ago. Today, it is just one of our growing industries. Taiwan can do this, too. Find out where the Mainland cannot compete with you.

Q: If we have a government that is not so efficient, how can we rebound?

A: You have to vote in for a change in government policies.

One important thing about choice is that choice is not decided by politicians. Choice is decided by those who are willing to offer themselves as the choices, as alternatives. If you have no good alternatives, whether you choose A, B, or C, you will get the same trouble. You must have good alternatives.

Q: As voters, what can we do if there is no good choices?

A: As voters, you can encourage new parties and new leaders to come forward. More important, as media, especially mainstream media like 天下雜誌, should encourage good people to move into main parties. Starting a new party in a place like Taiwan is not easy because there are already a lot of parties. The choice for the next election is between the DPP and KMT. You have to get good people to go into KMT and the DPP, the older people should make way for younger blood, to bring change to the society.

If I stayed on, instead of retiring in the 1990s, the PAP would be in deep trouble. I had been in charge for over 30 years. The people have become younger, but I have not become younger. The gap between my thinking and that of the younger generation has widened. So, at 67, I handed over to my deputy who was 50. When he reached 64 in 2004, he handed over to the next person, my son, who was 52 at that time.

When the prime minister changes, he brings in a new team. He does not keep the whole of the old team But only a few of them for continuity and experience, and to make sure he does not lose valuable inputs. But the driving force comes from the new team. That is why you see changes in Singapore.

Q: In this fast-changing world, what are the qualities a good leader must have?

A: Whether it is a fast-changing or slow-changing world, leaders are leaders. Leaders are people with convictions, basic beliefs about what is good for their society, how their country should be run, and they must have the ability to communicate and persuade people to follow them. Leaders may have many good ideas. If they are unable to articulate their ideas and persuade people, their ideas won’t be implemented and they won’t succeed. Leaders have to carry people with them.

A leader is specific for a particular society. A leader has to come from within the society. You cannot put Tony Blair in America or put George Bush in England. A leader must represent the feelings, the aspirations, and the thoughts of the people. But within a society, there must be many people with differing views and who will disagree on what is going on. The leader has to come forward to say, “Look! This is the better way forward.”

If the KMT wants to succeed, it must bring in new leaders. From our reports, one of the reasons why KMT had trouble before was because there were not many new faces. People want to see a new generation take over.

Now, 馬英九 is the new face, the new generation. But one man alone cannot do everything. He must bring in a new team of people, people in their 50’s and 40’s. Of course he needs to keep a few 60 or 70-year-old people for continuity. But the majority with the new ideas and policies will come from people in 40’s and early 50’s. They have the ideas and the energy to implement their ideas.

Having a global view is a plus. People can learn quickly. Usually leaders grow up with a domestic orientation. Not every body has the advantage of having seen the world. Studying abroad is useful. When they take over leadership in their 40’s or 50’s the world they saw in their 20’s was 20 or 30 years ago. Today with air travel and satellite TV, it is easy to learn about global issues, but it will be better if you visit their countries and their leaders personally.

I go to China every year because it is changing very fast. It is not just Beijing, Shanghai, Guanzhou, Dalian, Qindao, the whole country is changing. I went to Shenyang recently. I had not been there for 12 years. The city is totally different. The pollution is suppressed. The roads have four lanes each way. You feel the country is on the move, and Liaoning has a dynamic leader, 李克強, very smart and determined. My son, the PM, visited Shenyang last year and he told me it is worth visiting. I found it very interesting. I can read everything about China from reports. But going there gives me a deeper understanding than reading reports because I meet with the people and see the places.

This is a disadvantage for Taiwan’s leaders. You have a rule that no minister can visit Mainland. That’s a mistake. They do not know what is on the other side. It is not old China anymore. China is changing day by day and posing a very serious challenge to the world and most immediately to its neighbors. China’s challenge is particularly to Taiwan, especially as China wants to convince Taiwan that Taiwan cannot move away and seek independence.

China is not keen in forcing Taiwan into early reunification. They are comfortable with the status quo. Americans are also comfortable with the status quo. Taiwan is progressing peacefully. Taiwan gets technology from US, and sends older technology to China. China is quite happy. But if you move away and try to be independent, then Taiwan forces China to use all means stop the move.

Q: In your view, what should be the proper relationship between Taiwan and China?

A: Maintain peace and stability across the strait. Don’t have conflicts. You do not have to reunify any time soon. They have no time table.

If I were a Taiwanese, I will invest in China, but not only in China.

Japanese and Koreans are investing a lot of money in China, but they also invest in ASEAN countries, Australia, New Zealand, Europe, and America. It is in Taiwan’s interest to do the same. Taiwan’s top trading partner is already China. China is number two trade partner to Singapore, but soon it will become number one. But we do not put all our money in China alone because any Chinese economic down turn should be balanced by our trade and investments with other countries: Asean, India, Australia/New Zealand, besides Japan, US and EU.

Q: How should Taiwan face up to the fast rise of China if you were a leader of Taiwan?

A: Taiwan cannot be passive or Taiwan will lose. You have to accept the rise of China. Their universities, schools, hospitals, factories, gardens, and roads are growing very fast. 30 years ago, they came to Singapore to see how we grew trees and flowers on the roadside. Today, in Shenzhen, Shanghai, Beijing, you can see whole kilometers of flowers. In Singapore, we do not have farmers to grow flowers. We have Indian, Bangladeshi labourers, not gardeners. We only plant shrubs with flowers. They are 青出於藍. They are quick learners. But we are not stupid, because we recognize it. If we do not recognize it, then we are stupid. 知己知彼, then we progress.

Q: China is going back to emphasizing values and Confucius becomes popular now. Is it time for us to rethink the Asian value in a globalized and highly competitive world?

A: There are certain things in the life of a human being that do not change even as technology advances and the way of life changed – relationships with family, friends and society. The yearning for motherly love, warmth, comfort, companionship, the sense of loyalty to family, friends, and to relatives. They are the fundamentals that we change at the risk to ourselves.

But we can not accept, implement and practice every part of Confucius values that were formed in an agricultural age. The world has moved into an industrial, technological and globalized age. One of the most important changes in every developed society is the rise of double-income families. All developed societies have educated women. Women have their own careers. This has changed the husband and wife relationship. We must change and make adjustments. We must find ways to make it possible for women to have a career and have children, and also continue their careers. We are studying what Swedes and French have done. We give support to women in the workplace and in their careers. The support is not just financial support, but also support to bring up children while they are at work.

Q: Will there be an Asian century? What can Asians contribute to the world?

A: The centre of gravity of the world will be moving from the Atlantic to the Pacific. Many estimates put China’s GDP as large as America’s in 30 years, though its GDP per capita is still only one fifth of America’s. In 100 years China’s GDP will be larger than US GDP, and GDP per capita could be half of US GDP per capita. That will be a very different world. India, I believe it will grow at 60 to 70% of China’s speed. Assuming there is no war, no external conflict, no internal disorder or no civil unrest, China and India will be the first and second largest economies in the world, towards the end of the 21^st century.

China and India’s economic power, their economic weight, markets, their purchasing power, their ability to sell and buy from you and every other country will be so enormous. The technological power may be still with US, Europe and Japan. That will depend on how fast China and India will catch up. By 2050, the center of gravity will be definitely in the Pacific. That is good for Taiwan and also for Singapore.

Q: In your view, what is the future of Singapore? What role Singapore can play?

A: I cannot see what it will be after 50 years or 100 years. I see the next 10 to 15 years as promising. ASEAN’s 10 nations has been forced to consolidate because of the competition from China and India. So Asean has to form a free trade area to attract foreign investment and compete for investment. Conflicts will be muted because the competition is from outside the region. Singapore should do well because we have especially good relations and free trade agreements with America, comprehensive economic partnership with Japan, comprehensive economic cooperation with India. We have free trade agreements with Australia and New Zealand, and we also have FTA with ASEAN countries. We are going to negotiate a free trade agreement with China.

And the oil-producing states of the Gulf, Saudi Arabia, Qatar, Abu Dhabi are inviting us to do business with them. They want to go into China and Vietnam. They do not know these countries well. They know we understand these countries better. Their fund managers are coming to Singapore to set up offices. The next 10 to 15 years should be favorable.

Q: Will the relationship between Taiwan and Singapore improve?

A: Our relationship has been very close because we have a long history of mutual help. But if Taiwan’s government and media want to use Singapore to irritate and provoke China, our relationship will become difficult.

For 25 years, I travelled between Singapore and Taiwan with no Taiwanese media coverage. I always give interviews in Singapore, not in Taiwan. If Taiwan plays up my visits, Taiwan will make it difficult for Singapore and also for Taiwan itself because Taiwan is provoking China to object to these visits. You know that Singapore is investing more and more in China. China can hit our businesses there. Do we want this problem?

Q: What is your advice to the young people in Singapore and Taiwan to prepare themselves in the fast-changing world?

A: I give the same advice as I give to my own grandchildren.

First, in the fast-changing world, you may be changing your jobs and occupations more than once in your life. It is important that you should develop the art of continuous learning, and keep learning new areas of growth. No matter what the subject is coming (Info-comm and Technology, bio or life sciences), you must have a wide educational interests. You cannot just based on science or art. In today’s world, new discoveries are made by cross-disciplines. It is necessary to have a broad education, including art, music, science, and life sciences.

Second, you have to accept the fact that everything you learn will be outdated in 5 to 10 years. So you have to keep on learning. As you move into a specific area, you have to develop your skill in that area. But remember, technology may suddenly change, and you may have to change your course. And again, you must re-learn.

In today’s world, you must know at least two languages. For Singaporean Chinese, I advise them to learn English and Chinese. For Taiwanese, I say learning Chinese and English. I advised Singaporeans to cut off dialects because otherwise they will confuse themselves. Human brain is made for one language. Very few societies speak two languages. When people speak more than one language, they never speak them well.

I had been to Luxemburg where people speak French, German, Luxembergese and English, 4 languages. I read the newspapers there which were all very poor. I went to Mauritius which once was governed by the French and then governed by the British so they taught French and English. After it became independent, they taught Chinese to their Chinese, and Hindi to their Indians. They also have a local dialect at the same time. It is so confusing.

My advice, you must do well one language. The second language, you must try to be competent. Then you can connect to the world.

A strong balanced character is a must. If you do not have a sense of right and wrong, if you have no sense of honor, you are not trustworthy and you will never achieve anything no matter how good you are. You must be a trustworthy person, so people will work with you.

Q: Looking back, are you satisfied with what you have done? What things you are most proud of? If you have another chance, what you like to change?

A: There are things in my mind. From time to time in my idle moments. I ponder over our fate that we by ourselves can change nothing. At each juncture, each critical fork in the road, I made my decision. Once having made the decisions, you can not go back and re-decide. You have to live with your decisions. I made careful consideration of all the options, and had chosen the one which I thought is the best. And I have to live with it.

When I was young, I spent four years in England to become a lawyer. That changed my life. I saw how the British ran Singapore before the war, and also how the Japanese ran Singapore during the war. Then I saw how the British governed themselves. I decided we could govern ourselves because we had more interest on our lives than they had. That changed my life and I decided I would go into politics. This was the decision I made. I did the best I could. I had to make a nation out of a little island of two million people.

Singapore today is still making, living and making progress. That is not bad. This was the best I could do. Maybe I could have done better but I did not.

What I am proud about Singapore is that we have been able to maintain a clean system. Whether you are a Chinese, Malaysian, or Indian, you are promoted in school on merit, educated on merit, and getting job on merit. I am not saying there is completely no discrimination because Chinese employers like to employee Chinese. Malays like to hire Malays. But the government makes no such distinction. We hope eventually Chinese employers will employ everybody equally, but this is a very slow process.

The most important thing is that this system allows everybody to have a chance in life, no matter whether you are rich or poor you will have a good education, good health, and you can succeed.