1 00:00:06,090 --> 00:00:08,640 Speaker 1: Welcome to Cookie Time, a podcast series on markets and 2 00:00:08,640 --> 00:00:12,449 Speaker 1: economies from DBS Group Research. I'm Tebei, chief economist. Welcome 3 00:00:12,449 --> 00:00:16,930 Speaker 1: you to our 147th episode. Today, we are delighted to 4 00:00:16,930 --> 00:00:20,128 Speaker 1: have Kishore Mahbani back on the show. He's a distinguished 5 00:00:20,129 --> 00:00:23,649 Speaker 1: fellow at the Asia Research Institute, National University of Singapore. Mr. 6 00:00:23,690 --> 00:00:26,409 Speaker 1: Mahobani has been privileged to have two distinct and very 7 00:00:26,409 --> 00:00:30,049 Speaker 1: distinguished careers. First, as a diplomat from the 70s all 8 00:00:30,049 --> 00:00:32,769 Speaker 1: the way to the early 2000s, and then in academia. 9 00:00:33,180 --> 00:00:35,950 Speaker 1: He is a prolific writer who has spoken in many 10 00:00:35,950 --> 00:00:38,540 Speaker 1: corners of the world, and his latest book is Living 11 00:00:38,540 --> 00:00:44,229 Speaker 1: the Asian Century An Undiplomatic Memoir. Highly recommended. Kiswani, welcome 12 00:00:44,229 --> 00:00:46,470 Speaker 1: back to Coff Time. Thank you, Timur. It's great to 13 00:00:46,470 --> 00:00:48,779 Speaker 1: have you, and we are recording this in Mumbai, India. 14 00:00:49,029 --> 00:00:51,500 Speaker 1: So I would like to begin our conversation with India. 15 00:00:51,709 --> 00:00:55,270 Speaker 1: Where do you see India sitting here in late January 16 00:00:55,270 --> 00:00:57,950 Speaker 1: 2025 in the geopolitical landscape? 17 00:00:58,630 --> 00:01:00,639 Speaker 2: Uh, first of all, thank you very much for having 18 00:01:00,639 --> 00:01:04,319 Speaker 2: me on again. Uh, I know that our first recording 19 00:01:04,319 --> 00:01:05,599 Speaker 2: had quite a few 20 00:01:05,599 --> 00:01:06,199 Speaker 1: so 21 00:01:06,199 --> 00:01:06,629 Speaker 2: far 22 00:01:06,629 --> 00:01:07,639 Speaker 1: the history of COVID time, 23 00:01:07,800 --> 00:01:14,399 Speaker 2: yes. Um, you know, to understand, uh, India's place in 24 00:01:14,400 --> 00:01:16,190 Speaker 2: this geopolitical moment. 25 00:01:17,489 --> 00:01:20,690 Speaker 2: We have to understand first the geopolitical movement. 26 00:01:21,889 --> 00:01:26,209 Speaker 2: And here it's important to emphasize, we are a very 27 00:01:26,209 --> 00:01:28,500 Speaker 2: unique crossroads. 28 00:01:29,300 --> 00:01:30,930 Speaker 2: In the field of geopolitics. 29 00:01:31,629 --> 00:01:36,830 Speaker 2: So there are fundamental structural take uh structural changes. 30 00:01:37,620 --> 00:01:42,059 Speaker 2: Taking place in the geopolitical order. That's the moment. And 31 00:01:42,059 --> 00:01:47,690 Speaker 2: the question, therefore, is which countries are adapting well to this, 32 00:01:47,940 --> 00:01:52,300 Speaker 2: to these structural changes and which countries are adapting badly? 33 00:01:53,050 --> 00:01:55,730 Speaker 2: To these structural changes. I can give examples of both. 34 00:01:56,260 --> 00:01:58,739 Speaker 2: So clearly, one of the changes that is happening, and 35 00:01:58,739 --> 00:02:01,779 Speaker 2: I've said this over and over and over again, is 36 00:02:01,779 --> 00:02:04,739 Speaker 2: that we're reaching the end of 200 years of Western 37 00:02:04,739 --> 00:02:10,579 Speaker 2: domination of world history, you know. So, clearly the 88% 38 00:02:10,580 --> 00:02:14,300 Speaker 2: of the world's population who live outside the West are 39 00:02:14,300 --> 00:02:17,580 Speaker 2: waking up significantly and people ask me to give one 40 00:02:17,580 --> 00:02:18,949 Speaker 2: simple example of this. 41 00:02:19,350 --> 00:02:23,520 Speaker 2: I just say, look at the uh Ukraine war, even 42 00:02:23,520 --> 00:02:26,758 Speaker 2: though the Russian invasion of Ukraine was clearly illegal, no 43 00:02:26,758 --> 00:02:33,389 Speaker 2: question about that. When the West imposed sanctions on Russia, 85% 44 00:02:33,389 --> 00:02:37,119 Speaker 2: of the world's population didn't join the West in imposing 45 00:02:37,119 --> 00:02:41,479 Speaker 2: sanctions on Russia. So you can see, therefore this bifurcation. 46 00:02:42,410 --> 00:02:47,539 Speaker 2: And uh at the same time also, within the West, uh, 47 00:02:47,619 --> 00:02:51,940 Speaker 2: you have to make a huge distinction between United States 48 00:02:51,940 --> 00:02:54,779 Speaker 2: and Europe. You know, at the beginning of the 21st century, 49 00:02:54,860 --> 00:02:56,300 Speaker 2: they were more or less on par. 50 00:02:57,250 --> 00:03:00,519 Speaker 2: Now, look at the United States is so much bigger, right? 51 00:03:00,880 --> 00:03:03,330 Speaker 2: The EU has shrunk to 2/3 the size of the 52 00:03:03,330 --> 00:03:07,529 Speaker 2: United States and the European Union clearly has also lost 53 00:03:07,529 --> 00:03:12,210 Speaker 2: its way and is floundering in terms of adjusting to 54 00:03:12,210 --> 00:03:16,190 Speaker 2: this new world order, both in the arena of geopolitics 55 00:03:16,190 --> 00:03:20,449 Speaker 2: and their mismanagement of the Ukraine issue and also uh 56 00:03:20,449 --> 00:03:23,520 Speaker 2: in economics and not being able to grow their economies 57 00:03:23,800 --> 00:03:25,649 Speaker 2: and adapt and just to a new world. 58 00:03:26,100 --> 00:03:28,570 Speaker 2: By contrast, by the way, the United States looks very 59 00:03:28,570 --> 00:03:34,850 Speaker 2: robust and strong and and dynamic. So in this setting, uh, 60 00:03:34,860 --> 00:03:38,759 Speaker 2: there will be winners and losers with these structural changes, 61 00:03:38,770 --> 00:03:41,360 Speaker 2: and I predict that India will be a big winner 62 00:03:42,089 --> 00:03:46,089 Speaker 2: because this, this, this, these kinds of structural changes open 63 00:03:46,089 --> 00:03:50,050 Speaker 2: windows of opportunity and clearly India is going to have 64 00:03:50,050 --> 00:03:53,559 Speaker 2: a major window of opportunity because as things change. 65 00:03:54,039 --> 00:03:57,839 Speaker 2: As people try to cultivate the rising powers, India clearly 66 00:03:57,839 --> 00:04:00,279 Speaker 2: is one of the rising powers. The beginning of the 67 00:04:00,279 --> 00:04:04,940 Speaker 2: 20th century wasn't in the top 10 list of world economies. Uh, 68 00:04:05,039 --> 00:04:07,210 Speaker 2: today it is already number 5. By 2030, it will 69 00:04:07,210 --> 00:04:10,039 Speaker 2: be number 3. So India has arrived in that sense. 70 00:04:10,360 --> 00:04:14,360 Speaker 2: So as we move towards a multipolar world order, India 71 00:04:14,360 --> 00:04:17,600 Speaker 2: will be one of the significant poles, and India, therefore, 72 00:04:17,678 --> 00:04:21,359 Speaker 2: can become a huge beneficiary if it plays this game well. 73 00:04:22,160 --> 00:04:24,679 Speaker 1: So let's talk about the playing the game well in 74 00:04:24,678 --> 00:04:28,720 Speaker 1: the context of India-US relationship. We have Donald Trump back 75 00:04:28,720 --> 00:04:33,350 Speaker 1: in the White House. Um, India runs a large trade deficit. Uh, 76 00:04:33,589 --> 00:04:36,529 Speaker 1: the US has a big trade deficit vis a vis India. Uh, 77 00:04:36,809 --> 00:04:40,200 Speaker 1: Trump's key API or key performance indicator seems to be 78 00:04:40,559 --> 00:04:43,599 Speaker 1: narrowing deficit vis a vis nations. Would he impose tariffs 79 00:04:43,600 --> 00:04:45,558 Speaker 1: on India? How will India play that? What's your 80 00:04:45,559 --> 00:04:46,190 Speaker 1: sense? 81 00:04:46,519 --> 00:04:51,039 Speaker 2: Well, I think in the case of Donald Trump. 82 00:04:51,890 --> 00:04:55,469 Speaker 2: Uh, you have to do, uh, you have to switch 83 00:04:55,470 --> 00:04:59,269 Speaker 2: your means of calculating. Uh, you know, in the past, 84 00:04:59,369 --> 00:05:05,790 Speaker 2: you know, things like goodwill, relationships, uh, um, how do 85 00:05:05,790 --> 00:05:09,589 Speaker 2: you say, established history would make a difference. In the 86 00:05:09,589 --> 00:05:14,219 Speaker 2: case of Donald Trump, nothing matters except very simple question, 87 00:05:14,670 --> 00:05:17,549 Speaker 2: what have you done for me lately? That's all he asks. 88 00:05:18,390 --> 00:05:22,480 Speaker 2: And this is where on the one hand, uh, I 89 00:05:22,480 --> 00:05:27,359 Speaker 2: have no doubt that the close personal relationship between Donald 90 00:05:27,359 --> 00:05:30,760 Speaker 2: Trump and the Prime Minister Narendra Modi is a genuine, 91 00:05:31,000 --> 00:05:34,238 Speaker 2: they both get along with each other, will make some 92 00:05:34,238 --> 00:05:39,279 Speaker 2: kind of a difference. But you know, frankly, if you 93 00:05:39,279 --> 00:05:43,359 Speaker 2: look at countries in the world, no country has been 94 00:05:43,359 --> 00:05:46,928 Speaker 2: as loyal to the United States as Canada has been. 95 00:05:47,420 --> 00:05:49,160 Speaker 2: And if you look at the way that Canada has 96 00:05:49,160 --> 00:05:53,510 Speaker 2: been kicked around by Donald Trump, you realize that relationships 97 00:05:53,809 --> 00:05:54,559 Speaker 2: don't matter. 98 00:05:55,399 --> 00:05:58,170 Speaker 2: At the end of the day, what matters is pure 99 00:05:58,519 --> 00:06:03,920 Speaker 2: uh transactional interests, and he will want to see uh 100 00:06:03,920 --> 00:06:07,040 Speaker 2: balanced trade between US and India. 101 00:06:07,869 --> 00:06:11,070 Speaker 2: Uh, he may insist on India opening up, uh, some 102 00:06:11,070 --> 00:06:15,230 Speaker 2: of its markets, uh, to American products. He's going to 103 00:06:15,230 --> 00:06:19,670 Speaker 2: deport illegal Indian immigrants, which is, you know, going to 104 00:06:19,670 --> 00:06:21,989 Speaker 2: be a problem for India because if you look at 105 00:06:21,988 --> 00:06:24,829 Speaker 2: the countries with the number of illegal immigrants in the US, 106 00:06:24,869 --> 00:06:28,339 Speaker 2: number one is Mexico, number 2 is El Salvador, number 107 00:06:28,339 --> 00:06:29,589 Speaker 2: 3 is India. 108 00:06:30,238 --> 00:06:32,220 Speaker 2: So there'll be some friction, you know, in the way 109 00:06:32,220 --> 00:06:33,959 Speaker 2: it's done and so on and so forth. You saw 110 00:06:33,959 --> 00:06:36,279 Speaker 2: it with Colombia and all that, that's right. So there 111 00:06:36,279 --> 00:06:42,440 Speaker 2: are potential issues uh that could complicate uh relations uh 112 00:06:42,440 --> 00:06:47,269 Speaker 2: with the Donald Trump administration, but the biggest complication arises 113 00:06:47,269 --> 00:06:52,230 Speaker 2: from the fact that, you know, in the Biden administration 114 00:06:52,230 --> 00:06:57,440 Speaker 2: which courted India ferociously except except the last year, something 115 00:06:57,440 --> 00:06:58,959 Speaker 2: went wrong in the last year, clearly. 116 00:06:59,829 --> 00:07:04,679 Speaker 2: Uh, saw India as a natural ally against China. 117 00:07:05,540 --> 00:07:09,959 Speaker 2: Uh, Trump doesn't see allies as assets. 118 00:07:10,920 --> 00:07:13,989 Speaker 2: Trump sees allies as liabilities. 119 00:07:15,040 --> 00:07:18,809 Speaker 2: Seriously, so all he's asking you is, how much are 120 00:07:18,809 --> 00:07:21,519 Speaker 2: you paying me and what have you done for me lately? 121 00:07:22,190 --> 00:07:25,880 Speaker 2: And so even uh he's not going to see India 122 00:07:25,880 --> 00:07:31,160 Speaker 2: necessarily as an important ally, uh counterbalancing uh China, for example. 123 00:07:31,250 --> 00:07:35,160 Speaker 2: In fact, one of the problems that India may have 124 00:07:35,890 --> 00:07:39,649 Speaker 2: is that since Donald Trump is a big deal maker, 125 00:07:40,290 --> 00:07:43,170 Speaker 2: he may come to some kind of deal with China. 126 00:07:43,940 --> 00:07:48,679 Speaker 2: And if relations between US and China settle down, then 127 00:07:48,679 --> 00:07:53,239 Speaker 2: the value of India as a geopolitical card goes down. 128 00:07:54,220 --> 00:07:58,559 Speaker 2: And so India, therefore has got to adjust and therefore 129 00:07:58,559 --> 00:08:01,078 Speaker 2: try to see how we can take advantage of these 130 00:08:01,079 --> 00:08:04,480 Speaker 2: changes to ensure that its interests are protected. 131 00:08:05,179 --> 00:08:08,130 Speaker 1: I want to talk about India-China relationship momentarily, but just 132 00:08:08,130 --> 00:08:11,040 Speaker 1: want to stick with in the US, uh, briefly before 133 00:08:11,040 --> 00:08:15,200 Speaker 1: we do that. The US is, or rather Donald Trump's 134 00:08:15,200 --> 00:08:18,200 Speaker 1: team is keen on getting a deal done between Ukraine 135 00:08:18,200 --> 00:08:20,760 Speaker 1: and Russia, but the first step in that direction seems 136 00:08:20,760 --> 00:08:23,959 Speaker 1: to be tightening the screw on Russia and easing the screw, including. 137 00:08:24,369 --> 00:08:27,489 Speaker 1: Access to Russian oil, you know, heavy discount that both 138 00:08:27,489 --> 00:08:30,609 Speaker 1: India and China have been benefiting. So how does India 139 00:08:30,609 --> 00:08:35,049 Speaker 1: calibrate its still fairly deep relationship with Russia while dealing 140 00:08:35,049 --> 00:08:36,619 Speaker 1: with the US with this transactional? 141 00:08:37,979 --> 00:08:41,478 Speaker 2: Well, I think for India it's a matter of vital 142 00:08:41,770 --> 00:08:47,250 Speaker 2: national security interests to preserve its relationship with Russia. 143 00:08:48,099 --> 00:08:50,859 Speaker 2: Because at the end of the day, you know, when 144 00:08:50,859 --> 00:08:54,488 Speaker 2: you go through a crisis, we all go through crisis. 145 00:08:55,250 --> 00:08:58,409 Speaker 2: You have to ask yourself, who can you rely upon 146 00:08:58,409 --> 00:09:02,109 Speaker 2: in a crisis. So for example, that if India has 147 00:09:02,109 --> 00:09:07,750 Speaker 2: a problem that appears in the UN Security Council of 148 00:09:07,750 --> 00:09:12,339 Speaker 2: the five permanent members, United States, UK, France, China, Russia, 149 00:09:12,669 --> 00:09:18,229 Speaker 2: the only dependable ally or friend that India has is Russia. 150 00:09:18,900 --> 00:09:22,140 Speaker 2: If you, if India asked Russia to veto something on 151 00:09:22,140 --> 00:09:25,580 Speaker 2: India's behalf, Russia is likely to do so. So you 152 00:09:25,580 --> 00:09:30,488 Speaker 2: watch even the body language and the meetings between uh 153 00:09:30,489 --> 00:09:34,819 Speaker 2: Prime Minister Narendra Modi and Putin, President Putin within Prime 154 00:09:34,820 --> 00:09:37,780 Speaker 2: Minister Narendra Modi and Sergey Lavrov, you can see there's 155 00:09:37,780 --> 00:09:40,770 Speaker 2: a lot of trust that's been built up over there. 156 00:09:41,380 --> 00:09:44,609 Speaker 2: So India is not going to give up its relationship 157 00:09:44,609 --> 00:09:45,419 Speaker 2: with Russia. 158 00:09:45,909 --> 00:09:50,419 Speaker 2: And for India as a net importing oil country, to 159 00:09:50,419 --> 00:09:53,280 Speaker 2: give up access to cheap Russian oil will be a 160 00:09:53,280 --> 00:09:57,059 Speaker 2: huge economic price to pay, and I don't see how 161 00:09:57,059 --> 00:10:01,218 Speaker 2: why Indian should pay that economic price. So I think 162 00:10:01,219 --> 00:10:08,710 Speaker 2: they will definitely resist any moves to um ah have 163 00:10:09,179 --> 00:10:10,978 Speaker 2: get by the US to try and get them to 164 00:10:10,979 --> 00:10:13,049 Speaker 2: cut off their ties with Russia. 165 00:10:13,659 --> 00:10:15,689 Speaker 2: And you know, going, you since you want to discuss 166 00:10:15,690 --> 00:10:21,789 Speaker 2: the USIndia relationship. I think it's also important to emphasize 167 00:10:21,789 --> 00:10:26,510 Speaker 2: why why did things go some a bit rough in 168 00:10:26,510 --> 00:10:29,880 Speaker 2: the last year, the Biden administration. Things seem to be, 169 00:10:30,190 --> 00:10:31,669 Speaker 2: you know, going so well. 170 00:10:32,349 --> 00:10:35,520 Speaker 2: And then you had at least 3 points of friction 171 00:10:35,520 --> 00:10:40,049 Speaker 2: that emerged. First was, of course, the, uh, I think 172 00:10:40,049 --> 00:10:44,090 Speaker 2: India was surprised how Canada went full blast on going 173 00:10:44,090 --> 00:10:45,010 Speaker 2: after India. 174 00:10:46,070 --> 00:10:49,579 Speaker 2: About the purported assassination of a Canadian citizen. 175 00:10:50,400 --> 00:10:54,489 Speaker 2: And you know, traditionally, Canada would listen to hints from 176 00:10:54,489 --> 00:10:55,409 Speaker 2: Washington DC. 177 00:10:56,710 --> 00:10:59,849 Speaker 2: Didn't the Biden administration tell Canada, go easy, you know, 178 00:10:59,909 --> 00:11:03,329 Speaker 2: India is an important friend. That question must be on 179 00:11:03,330 --> 00:11:07,270 Speaker 2: Indian minds. And then, of course, the sudden removal of 180 00:11:07,270 --> 00:11:11,150 Speaker 2: Sheikh Hasina from Bangladesh was also a bit of a 181 00:11:11,150 --> 00:11:15,179 Speaker 2: shock for India, because Sheikh Hasina was a reliable friend 182 00:11:15,179 --> 00:11:17,989 Speaker 2: of India and right now, as you know, she's in India. 183 00:11:18,849 --> 00:11:23,429 Speaker 2: Uh, and that also, frankly, was encouraged uh by the 184 00:11:23,429 --> 00:11:25,598 Speaker 2: United States that we know it's a matter of fact. 185 00:11:26,400 --> 00:11:30,799 Speaker 2: And then thirdly, the other thing that surprised me was 186 00:11:30,799 --> 00:11:35,880 Speaker 2: the decision of the Justice Department of uh the Biden 187 00:11:35,880 --> 00:11:37,799 Speaker 2: administration to go after Adani. 188 00:11:38,859 --> 00:11:42,859 Speaker 2: I mean, surely enough people in Washington DC knew that, 189 00:11:43,270 --> 00:11:46,849 Speaker 2: you know, Mr. Adani is very close to Prime Minister Modi. 190 00:11:46,869 --> 00:11:50,789 Speaker 2: So suddenly you find a relationship that you thought was 191 00:11:50,789 --> 00:11:51,590 Speaker 2: a good one. 192 00:11:52,369 --> 00:11:57,809 Speaker 2: Uh, got a lot of sand was thrown into the gearbox. 193 00:11:58,330 --> 00:12:01,150 Speaker 2: And so that's why I think India has got to 194 00:12:01,150 --> 00:12:06,848 Speaker 2: really decide, uh, how it balances, it's still, it's still 195 00:12:06,849 --> 00:12:08,489 Speaker 2: going to have good relations with the US, by the way, 196 00:12:08,580 --> 00:12:12,770 Speaker 2: there's no question whatsoever, but how you balance the, how 197 00:12:12,770 --> 00:12:15,728 Speaker 2: you play the balance within US and China. You got 198 00:12:15,729 --> 00:12:17,650 Speaker 2: to recalibrate now. 199 00:12:18,049 --> 00:12:18,289 Speaker 1: Speaking 200 00:12:18,289 --> 00:12:20,960 Speaker 1: of recalibration, let's talk about India and China relationship. 201 00:12:22,450 --> 00:12:26,799 Speaker 2: Yeah, well, I think in the case of the India-China relationship, 202 00:12:26,919 --> 00:12:31,189 Speaker 2: clearly some degree of rethinking is going on. I mean, I, 203 00:12:31,320 --> 00:12:33,359 Speaker 2: I was surprised to learn from you this morning. 204 00:12:34,000 --> 00:12:37,710 Speaker 2: That India has allowed the resumption of direct flights between 205 00:12:37,710 --> 00:12:40,750 Speaker 2: India and China. That was a major anomaly. I mean, 206 00:12:40,789 --> 00:12:43,819 Speaker 2: a major anomaly. I mean, the two biggest. 207 00:12:44,559 --> 00:12:48,080 Speaker 2: Uh, uh, I mean, apart from Japan, the two biggest 208 00:12:48,080 --> 00:12:50,520 Speaker 2: economies in Asia have no direct flights to each other. 209 00:12:50,609 --> 00:12:53,369 Speaker 2: That doesn't make sense, you know. So clearly there was 210 00:12:53,369 --> 00:12:57,429 Speaker 2: a big move and it's part of a gradual recalibration 211 00:12:57,919 --> 00:13:01,968 Speaker 2: driven partly by the fact you by realization you can't 212 00:13:01,969 --> 00:13:04,209 Speaker 2: put all your eggs in the American basket. You can't 213 00:13:04,210 --> 00:13:05,319 Speaker 2: just rely on the 214 00:13:06,109 --> 00:13:11,789 Speaker 2: Uh, United States and at the same time, uh, if 215 00:13:11,789 --> 00:13:17,659 Speaker 2: India's goal is to become a manufacturing economy, no country 216 00:13:17,659 --> 00:13:22,619 Speaker 2: in the world, anywhere, by the way, including United States, Germany, uh, 217 00:13:22,840 --> 00:13:28,189 Speaker 2: UK can advance their manufacturing agenda without in one way 218 00:13:28,190 --> 00:13:32,020 Speaker 2: or another getting inputs from China. I mean, the most 219 00:13:32,020 --> 00:13:34,570 Speaker 2: stunning statistic of the 21st century. 220 00:13:35,270 --> 00:13:39,190 Speaker 2: Is that when the 21st century opened in the year 2000. 221 00:13:39,840 --> 00:13:43,349 Speaker 2: Uh, China's share of global manufacturing was 5%. 222 00:13:44,549 --> 00:13:49,830 Speaker 2: Uh, by 2030, it will be 45%. Now that's stunning. Now, 223 00:13:49,950 --> 00:13:53,939 Speaker 2: virtually every product in the world that is manufactured, I think, 224 00:13:54,469 --> 00:13:57,789 Speaker 2: in one way or another contains some kind of Chinese 225 00:13:57,789 --> 00:14:03,520 Speaker 2: uh component because that's how indispensable the Chinese manufacturing economy 226 00:14:03,520 --> 00:14:08,659 Speaker 2: has begun. And if you, if you closed your eyes, OK, you, you, 227 00:14:08,710 --> 00:14:11,919 Speaker 2: you scrub out the word India, put economy X. 228 00:14:12,340 --> 00:14:16,020 Speaker 2: And you scrub out the word China, you put economy Y. 229 00:14:16,739 --> 00:14:22,630 Speaker 2: And you did a simple cost-benefit calculation. Would economy X 230 00:14:23,239 --> 00:14:27,599 Speaker 2: benefit from closer cooperation in manufacturing economy Y or would 231 00:14:27,599 --> 00:14:30,039 Speaker 2: it be would it be better off doing less with 232 00:14:30,039 --> 00:14:35,479 Speaker 2: economy Y? And any kind of basic cost-benefit calculation will 233 00:14:35,479 --> 00:14:39,640 Speaker 2: show you that India will benefit a lot more by 234 00:14:39,640 --> 00:14:41,349 Speaker 2: not necessarily cooperating. 235 00:14:41,710 --> 00:14:46,960 Speaker 2: But taking advantage of China's manufacturing capabilities to enhance its 236 00:14:46,960 --> 00:14:51,400 Speaker 2: own manufacturing uh in India. And so to give a 237 00:14:51,400 --> 00:14:54,479 Speaker 2: simple and obvious example, India wants to become a big 238 00:14:54,479 --> 00:15:00,280 Speaker 2: manufacturer of iPhones. There is no way you can manufacture 239 00:15:00,280 --> 00:15:05,789 Speaker 2: an iPhone without Chinese components. No way, absolutely no way. 240 00:15:06,280 --> 00:15:09,320 Speaker 2: And I can tell you that Apple's reliance. 241 00:15:10,059 --> 00:15:14,030 Speaker 2: Everybody thinks that because of the US China friction. 242 00:15:14,900 --> 00:15:19,200 Speaker 2: Apple has reduced its reliance on Chinese components. If you 243 00:15:19,200 --> 00:15:21,409 Speaker 2: studied carefully, it has actually increased. 244 00:15:22,210 --> 00:15:25,929 Speaker 2: Because the, the products in China have become cheaper and 245 00:15:25,929 --> 00:15:31,609 Speaker 2: more competitive, and Apple is all about profits. So clearly, you, you, 246 00:15:31,650 --> 00:15:36,010 Speaker 2: if you really want to enhance your manufacturing capability, and 247 00:15:36,010 --> 00:15:39,409 Speaker 2: I think as you know, some people within the Prime 248 00:15:39,409 --> 00:15:42,210 Speaker 2: Minister Modi's government are coming to realize that they have 249 00:15:42,210 --> 00:15:44,929 Speaker 2: to in one way or another collaborate with China too. 250 00:15:45,840 --> 00:15:49,690 Speaker 1: It is encouraging, uh, absolutely. Uh, you mentioned Apple. My 251 00:15:49,690 --> 00:15:52,919 Speaker 1: understanding is that when Foxconn was initially nudged into assembling 252 00:15:52,919 --> 00:15:56,890 Speaker 1: iPhones in India, the fear, even among Indians was that, 253 00:15:56,969 --> 00:15:59,090 Speaker 1: you know, it may not match the efficiency of Chinese 254 00:15:59,090 --> 00:16:01,450 Speaker 1: manufacturing plants. But now we can see that there's a 255 00:16:01,450 --> 00:16:04,130 Speaker 1: win-win there. You be part of the Chinese supply chain, 256 00:16:04,210 --> 00:16:07,080 Speaker 1: bring in the inputs, bring in Indian labor, train them, 257 00:16:07,210 --> 00:16:09,419 Speaker 1: and now my understanding is that the Apple's yield in 258 00:16:09,419 --> 00:16:13,140 Speaker 1: India is almost as good as it is in China. Uh, so. 259 00:16:13,530 --> 00:16:16,979 Speaker 1: There is a mutually beneficial dynamic there in place. Foxconn 260 00:16:16,979 --> 00:16:20,179 Speaker 1: is happy, India is happy, Chinese components remain in place, uh, 261 00:16:20,289 --> 00:16:20,409 Speaker 1: but 262 00:16:20,409 --> 00:16:22,919 Speaker 2: it has increased India's trade deficit with China. 263 00:16:23,330 --> 00:16:25,650 Speaker 1: It will probably do the same, yes, indeed. Um, so 264 00:16:25,650 --> 00:16:29,409 Speaker 1: that's the irony that India's fear about Chinese trade deficit 265 00:16:29,409 --> 00:16:31,539 Speaker 1: probably got in the way of India joining regional companies 266 00:16:31,539 --> 00:16:32,809 Speaker 1: of economic partnership with. 267 00:16:33,359 --> 00:16:36,270 Speaker 1: Uh, now, again, there's some rethink that maybe that was 268 00:16:36,270 --> 00:16:40,590 Speaker 1: an opportunity lost. You can't just fixate on a bilateral deficit. 269 00:16:40,630 --> 00:16:42,309 Speaker 1: You have to sort of think about your own export 270 00:16:42,309 --> 00:16:46,309 Speaker 1: prowess and how you build it with cooperation, joint ventures, 271 00:16:46,320 --> 00:16:48,260 Speaker 1: if you will, with others. Like you sure I see, 272 00:16:48,309 --> 00:16:52,020 Speaker 1: for example, uh, MG cars on the roads of India. 273 00:16:52,309 --> 00:16:55,630 Speaker 1: It's a joint venture between an Indian company and Chinese SAIC. 274 00:16:56,140 --> 00:16:58,090 Speaker 1: So that's the Chinese model in the past worked very 275 00:16:58,090 --> 00:17:00,900 Speaker 1: well for China, and I think India with this recalibration 276 00:17:01,130 --> 00:17:02,729 Speaker 1: is beginning to head in that direction. I think that's 277 00:17:02,729 --> 00:17:04,089 Speaker 1: a welcome development. Yeah, 278 00:17:04,209 --> 00:17:09,930 Speaker 2: but I'm glad you mentioned RCEP because I think all the, again, 279 00:17:10,290 --> 00:17:16,300 Speaker 2: objective econometric studies show that if India joins the RCEP, 280 00:17:16,410 --> 00:17:18,319 Speaker 2: you'll be a net beneficiary. 281 00:17:18,760 --> 00:17:22,899 Speaker 2: And India's GNP will gain a boost. I mean, there 282 00:17:22,900 --> 00:17:27,979 Speaker 2: was already a very powerful geopolitical argument uh for India 283 00:17:27,979 --> 00:17:32,180 Speaker 2: to join the RCEP because, you know, if India stays 284 00:17:32,180 --> 00:17:37,180 Speaker 2: out of RCEP, it will lose its ability to integrate 285 00:17:37,180 --> 00:17:43,089 Speaker 2: better with the ASEAN region. And you know, Southeast Asia, uh, 286 00:17:43,099 --> 00:17:45,369 Speaker 2: for only for 2000 years. 287 00:17:46,439 --> 00:17:51,119 Speaker 2: Has been trying to balance China and India, right? And overall, 288 00:17:51,359 --> 00:17:55,030 Speaker 2: Indian influence in Southeast Asia has always been very strong 289 00:17:55,640 --> 00:17:58,319 Speaker 2: because out of the 10 countries in Southeast Asia, 9 290 00:17:58,319 --> 00:18:02,270 Speaker 2: have an indic base. Only 1 Vietnam has a scenic base. 291 00:18:02,520 --> 00:18:08,310 Speaker 2: So there's a natural affinity, natural, how do you say, 292 00:18:08,319 --> 00:18:11,229 Speaker 2: complementarity between Southeast Asia and India. 293 00:18:11,709 --> 00:18:15,359 Speaker 2: But what RCEP does is in with India not joining 294 00:18:15,359 --> 00:18:19,040 Speaker 2: is that India cuts itself off from Southeast Asia. There's 295 00:18:19,040 --> 00:18:23,560 Speaker 2: a manufacturing ecosystem there, very powerful one. And in Southeast Asia, 296 00:18:23,599 --> 00:18:27,000 Speaker 2: of course, by then, uh, by default gets closer uh 297 00:18:27,000 --> 00:18:30,239 Speaker 2: to China. So there's real political argument for India to 298 00:18:30,239 --> 00:18:36,429 Speaker 2: join RCP, but more importantly, you know, in the long run, uh, 299 00:18:36,599 --> 00:18:40,550 Speaker 2: India is going to make a vital strategic decision. 300 00:18:41,219 --> 00:18:43,989 Speaker 2: And this is a big strategic decision that only someone 301 00:18:43,989 --> 00:18:48,708 Speaker 2: as strong as Prime Minister Narendra Modi can make that 302 00:18:48,709 --> 00:18:52,419 Speaker 2: do you, in the long run, will the Indian economy 303 00:18:52,420 --> 00:18:58,589 Speaker 2: succeed by being more protectionist or being by being more open? 304 00:18:58,949 --> 00:19:03,270 Speaker 2: And frankly, the main reason why China has succeeded as 305 00:19:03,270 --> 00:19:06,790 Speaker 2: an economy so well is that the Chinese made a 306 00:19:06,790 --> 00:19:10,979 Speaker 2: big strategic decision that the only reason why they suffered. 307 00:19:11,189 --> 00:19:15,929 Speaker 2: The century of humiliation from 1842 to 1949, and the 308 00:19:15,930 --> 00:19:18,329 Speaker 2: reason why they became so weak is because they closed 309 00:19:18,329 --> 00:19:21,400 Speaker 2: their economy and not integrated with the rest of the world. 310 00:19:21,760 --> 00:19:24,800 Speaker 2: And as you know, the Chinese have decided, OK, now 311 00:19:24,800 --> 00:19:28,329 Speaker 2: we'll do the opposite. As Xi Jinping said in Davos 312 00:19:28,329 --> 00:19:32,560 Speaker 2: in 2017, we'll be plunge into the ocean of globalization, 313 00:19:32,650 --> 00:19:36,209 Speaker 2: we struggle to swim, we drank water, but we became 314 00:19:36,209 --> 00:19:37,169 Speaker 2: stronger as a result. 315 00:19:37,520 --> 00:19:41,829 Speaker 2: And so now Chinese economy by integrating it with the 316 00:19:41,829 --> 00:19:45,669 Speaker 2: rest of the world, has become a remarkably robust and 317 00:19:45,670 --> 00:19:46,989 Speaker 2: strong economy, you know. 318 00:19:47,680 --> 00:19:50,659 Speaker 2: And I think India can do the same because India, 319 00:19:50,819 --> 00:19:55,859 Speaker 2: Indians are naturally competitive. I mean, you look at every 320 00:19:55,859 --> 00:20:00,260 Speaker 2: country in the world, the Indians have migrated to, and 321 00:20:00,260 --> 00:20:03,699 Speaker 2: I can say this with some confidence as aindi. I 322 00:20:03,699 --> 00:20:06,780 Speaker 2: have first cousins, you know, children of my mother's and 323 00:20:06,780 --> 00:20:14,869 Speaker 2: father's siblings all over the world living in Guyana, uh, Suriname, Texas, London, Florida. 324 00:20:15,609 --> 00:20:23,310 Speaker 2: Uh, Nigeria, Ghana, Mumbai, Kolkata, Singapore, Hong Kong, Japan, every 325 00:20:23,310 --> 00:20:27,819 Speaker 2: corner of the world. I have first cousins and Kyoto, yeah, 326 00:20:27,910 --> 00:20:31,140 Speaker 2: and you know what, they, they're all doing very well. 327 00:20:32,239 --> 00:20:35,520 Speaker 2: They they compete very well, uh, in, in, in, in 328 00:20:35,520 --> 00:20:39,560 Speaker 2: a competitive uh economic uh environment. You can see in 329 00:20:39,560 --> 00:20:43,438 Speaker 2: the United States, which is the most competitive human laboratory 330 00:20:43,439 --> 00:20:46,020 Speaker 2: in the world, uh, the ethnic community with the highest 331 00:20:46,020 --> 00:20:47,800 Speaker 2: per capita income are the Indians. 332 00:20:48,319 --> 00:20:51,760 Speaker 2: So, you know, India, therefore needs to make a very 333 00:20:51,760 --> 00:20:58,000 Speaker 2: powerful strategic decision that India can and will compete. Now, 334 00:20:58,010 --> 00:21:00,599 Speaker 2: of course, when you open up the economy, there will 335 00:21:00,599 --> 00:21:05,189 Speaker 2: be disruptions, there will be difficulties, you know, it's it's, 336 00:21:05,199 --> 00:21:09,660 Speaker 2: it's the same thing that happens when a woman gives birth, right? You, 337 00:21:09,800 --> 00:21:13,520 Speaker 2: you go through labor pains. After the labor pains, you 338 00:21:13,520 --> 00:21:15,709 Speaker 2: end up with a beautiful uh baby. 339 00:21:16,489 --> 00:21:19,699 Speaker 2: So and and that beautiful baby could be a much 340 00:21:19,699 --> 00:21:22,099 Speaker 2: more dynamic competitive Indian economy. 341 00:21:23,939 --> 00:21:27,250 Speaker 1: Sure, uh, we are two Singaporeans sitting here in India. 342 00:21:27,459 --> 00:21:30,290 Speaker 1: So let's talk a little bit about Singapore-India relationship. 343 00:21:31,770 --> 00:21:35,390 Speaker 2: Sure. Well, I think we are, we are very blessed. 344 00:21:36,329 --> 00:21:41,139 Speaker 2: Uh, that early on, uh, all the leaders of, uh, 345 00:21:41,150 --> 00:21:47,500 Speaker 2: Singapore decided that they had to make long-term investments in India. And, 346 00:21:47,510 --> 00:21:50,750 Speaker 2: you know, it, it happened under Mr. Lee Kuan Yew. 347 00:21:50,829 --> 00:21:54,750 Speaker 2: I actually personally accompanied Mr. Lee Kuan Yew, uh, when 348 00:21:54,750 --> 00:21:57,430 Speaker 2: he visited India, and I, all I remember is that 349 00:21:57,430 --> 00:22:01,150 Speaker 2: at that time, I think the Prime Minister was Murai Jayai. 350 00:22:01,930 --> 00:22:05,419 Speaker 2: And, uh, Indira Gandhi was in opposition, so you can 351 00:22:05,420 --> 00:22:08,290 Speaker 2: more or less figure out what year it was. So 352 00:22:08,290 --> 00:22:11,619 Speaker 2: it regularly, Prime Minister Lee Kuan Yeww used to come here, 353 00:22:11,900 --> 00:22:14,500 Speaker 2: come here, but the man who triggered what you call 354 00:22:14,500 --> 00:22:18,699 Speaker 2: the India fever, uh, in Singapore was Prime Minister Goh 355 00:22:18,699 --> 00:22:23,180 Speaker 2: Chok Tong. And you, you mentioned my, uh, memoirs, Living 356 00:22:23,180 --> 00:22:26,619 Speaker 2: the Asian Century. I think I also talk about how 357 00:22:26,619 --> 00:22:28,260 Speaker 2: Prime Minister Goh Chok Tong. 358 00:22:29,119 --> 00:22:32,910 Speaker 2: Uh, you know, worked hard to get India admitted into 359 00:22:32,910 --> 00:22:37,750 Speaker 2: the ASEAN Regional Forum, you know. So over the years, 360 00:22:37,880 --> 00:22:41,040 Speaker 2: a lot of trust has been built up between the 361 00:22:41,040 --> 00:22:45,989 Speaker 2: Indian leaders and, and Singapore. So I think that, uh, 362 00:22:46,000 --> 00:22:51,069 Speaker 2: that long term trust means that we have a very stable, uh, 363 00:22:51,079 --> 00:22:52,479 Speaker 2: long term relationship. 364 00:22:53,140 --> 00:22:56,979 Speaker 2: Uh, between India and Singapore. But at the same time, 365 00:22:57,060 --> 00:23:00,410 Speaker 2: I think it's important for Singapore to realize. 366 00:23:01,420 --> 00:23:06,650 Speaker 2: That the competition for attention of India is growing more 367 00:23:06,650 --> 00:23:09,930 Speaker 2: intense because all you have to do is do a 368 00:23:09,930 --> 00:23:13,729 Speaker 2: count of all the leaders coming to Delhi now to 369 00:23:13,729 --> 00:23:17,339 Speaker 2: court India. It's, it's gone up like this, right? Clearly, 370 00:23:17,530 --> 00:23:20,880 Speaker 2: India's influence is grown. So you cannot take for granted 371 00:23:20,880 --> 00:23:24,448 Speaker 2: that just because we were close relation, have close relations 372 00:23:24,449 --> 00:23:27,660 Speaker 2: in the past, we have close relations in the future, 373 00:23:27,930 --> 00:23:29,979 Speaker 2: we have to reinvent ourselves. 374 00:23:31,060 --> 00:23:33,719 Speaker 2: And continue to work hard to get closer because you 375 00:23:33,719 --> 00:23:39,199 Speaker 2: can see already in the past, uh, relations between Indonesia 376 00:23:39,199 --> 00:23:43,670 Speaker 2: and India were not close, but just a few days ago, uh, 377 00:23:43,719 --> 00:23:47,478 Speaker 2: President Prabowo was invited as the chief guest, uh, of 378 00:23:47,479 --> 00:23:52,000 Speaker 2: the Indian government. So that, that's an example of how 379 00:23:52,000 --> 00:23:54,530 Speaker 2: the competition for India's attention. 380 00:23:54,979 --> 00:23:56,609 Speaker 2: Will grow in the coming years. 381 00:23:57,140 --> 00:24:00,149 Speaker 1: this is a very critical point. Uh, last year, uh, 382 00:24:00,260 --> 00:24:04,199 Speaker 1: several members of Indian Chamber of Commerce were in Singapore, 383 00:24:04,619 --> 00:24:06,869 Speaker 1: and they seem to suggest, I mean, there was a 384 00:24:06,869 --> 00:24:08,579 Speaker 1: push back to what they said, but they seem to 385 00:24:08,579 --> 00:24:13,239 Speaker 1: think that Singapore lacks a credible, coherent strategy, vis a 386 00:24:13,239 --> 00:24:16,939 Speaker 1: vis India, especially with all these um competition for attention, 387 00:24:16,979 --> 00:24:20,609 Speaker 1: if you will. Um, so what should be Singapore's strategy 388 00:24:20,609 --> 00:24:23,060 Speaker 1: in this time when India is being quartered by the 389 00:24:23,060 --> 00:24:23,609 Speaker 1: whole world? 390 00:24:24,170 --> 00:24:27,619 Speaker 2: Well, I think the important thing is to continue working 391 00:24:27,619 --> 00:24:31,680 Speaker 2: in the relationship, and I'm very glad that uh President 392 00:24:31,680 --> 00:24:39,329 Speaker 2: Thaman Shamugratnam came on a state visit to India. I think, uh, probably, uh, 393 00:24:39,339 --> 00:24:43,959 Speaker 2: apart from the two former prime ministers, uh, Mr. Goh 394 00:24:43,959 --> 00:24:47,420 Speaker 2: Chok Tong and Mr. Lee Hsien Loong, uh, I think 395 00:24:47,420 --> 00:24:52,339 Speaker 2: the the third most respected Singaporean figure in, uh, India 396 00:24:52,339 --> 00:24:53,739 Speaker 2: is Thaman Chamratnam. 397 00:24:54,380 --> 00:24:57,938 Speaker 2: There's a lot of uh reverence for him and trust 398 00:24:57,939 --> 00:25:01,619 Speaker 2: in him. So it's good that he came and re-established. 399 00:25:02,390 --> 00:25:05,589 Speaker 2: The close relations, but we also have to keep on 400 00:25:05,589 --> 00:25:11,589 Speaker 2: sending uh visitors and also working hard to find concrete 401 00:25:11,589 --> 00:25:17,349 Speaker 2: areas of uh cooperation and collaboration between India and Singapore. 402 00:25:17,670 --> 00:25:20,869 Speaker 2: And I hope that we can at least work with 403 00:25:20,869 --> 00:25:25,030 Speaker 2: India slowly to try and persuade India to reconsider your 404 00:25:25,030 --> 00:25:27,750 Speaker 2: decision not to join the RCEP. 405 00:25:28,189 --> 00:25:31,550 Speaker 2: Because I think once India joins the RCP and benefits 406 00:25:31,550 --> 00:25:36,790 Speaker 2: from joining RCEP, uh, then the ties, uh, not just 407 00:25:36,790 --> 00:25:40,030 Speaker 2: within India and Singapore, but India and Southeast Asia will 408 00:25:40,030 --> 00:25:40,900 Speaker 2: become much stronger. 409 00:25:41,060 --> 00:25:45,660 Speaker 1: Yeah, I fully concur. Um, let's, uh, put India aside 410 00:25:45,660 --> 00:25:48,149 Speaker 1: for the time being and talk about what you and 411 00:25:48,150 --> 00:25:51,379 Speaker 1: I discussed at length in the previous podcast, the China-US relationship. 412 00:25:52,349 --> 00:25:56,229 Speaker 1: How do things look from Beijing's perspective, including the last 413 00:25:56,229 --> 00:25:58,780 Speaker 1: 4 years of Biden administration and the coming 4 years 414 00:25:58,780 --> 00:25:59,959 Speaker 1: of Trump administration here again, 415 00:26:03,109 --> 00:26:08,550 Speaker 2: it's very important to make a distinction between the structural 416 00:26:08,550 --> 00:26:11,540 Speaker 2: changes and the short term developments. 417 00:26:12,880 --> 00:26:13,339 Speaker 2: Excuse me. 418 00:26:18,719 --> 00:26:18,729 Speaker 2: Um, 419 00:26:21,280 --> 00:26:24,959 Speaker 2: Structurally, the relationship between US and China. 420 00:26:26,380 --> 00:26:27,020 Speaker 2: is shifting 421 00:26:28,060 --> 00:26:29,689 Speaker 2: I mean, the. 422 00:26:30,959 --> 00:26:33,660 Speaker 2: Americans are obviously trying to stop China's development. 423 00:26:35,359 --> 00:26:37,520 Speaker 2: They think to some extent they have done so. 424 00:26:38,439 --> 00:26:42,430 Speaker 2: But if you take a 10 year time horizon, no way, 425 00:26:42,770 --> 00:26:43,770 Speaker 2: they're going to stop China. 426 00:26:44,510 --> 00:26:47,239 Speaker 2: So the Chinese still feel confident. 427 00:26:49,050 --> 00:26:52,089 Speaker 2: That the long run, the long run, they are, they'll 428 00:26:52,089 --> 00:26:55,130 Speaker 2: be better off. The Chinese economy, as you know, is 429 00:26:55,130 --> 00:26:58,069 Speaker 2: having some real short term challenges. The next 2 to 430 00:26:58,069 --> 00:27:02,729 Speaker 2: 3 years will be difficult. The real estate market is 431 00:27:02,729 --> 00:27:03,770 Speaker 2: still in the dumps. 432 00:27:04,449 --> 00:27:06,718 Speaker 2: Uh, consumer sentiment is down. 433 00:27:07,780 --> 00:27:12,688 Speaker 2: Business sentiment is down, so they're struggling to get their 5% 434 00:27:12,689 --> 00:27:15,079 Speaker 2: growth rate. So over the next 2 to 3 years, 435 00:27:15,410 --> 00:27:18,209 Speaker 2: Chinese economy is going to be struggling. But if you 436 00:27:18,209 --> 00:27:20,719 Speaker 2: look at China decade by decade. 437 00:27:21,670 --> 00:27:24,310 Speaker 2: At the end of each decade, they look so much 438 00:27:24,310 --> 00:27:27,099 Speaker 2: stronger and I, and I, I gave the statistic how 439 00:27:27,640 --> 00:27:30,589 Speaker 2: their share of global manufacturing has gone from 5% in 440 00:27:30,589 --> 00:27:34,869 Speaker 2: 2000 and will reach 45% in 2030. That's an example 441 00:27:34,869 --> 00:27:38,229 Speaker 2: of how this look decade by decade and and certainly 442 00:27:38,229 --> 00:27:41,959 Speaker 2: if you look at, you ask yourself a very simple question. 443 00:27:43,119 --> 00:27:46,479 Speaker 2: Which leading economy in the world? 444 00:27:47,349 --> 00:27:51,500 Speaker 2: Has invested the most in the industries of the future. 445 00:27:52,930 --> 00:28:00,170 Speaker 2: I mean, no question is China, EVs, solar panels, wind turbines, 446 00:28:00,550 --> 00:28:03,750 Speaker 2: battery technology, robots, you go on, right? 447 00:28:04,920 --> 00:28:09,170 Speaker 2: And uh if there's one economy that's really prepared for 448 00:28:09,170 --> 00:28:12,410 Speaker 2: the future, preparing itself for the future, is China, and 449 00:28:12,410 --> 00:28:15,170 Speaker 2: it's causing structural changes around the world. I mean, if 450 00:28:15,170 --> 00:28:19,079 Speaker 2: you and I had had this interview 10 years ago, 451 00:28:19,410 --> 00:28:19,849 Speaker 2: and I told you. 452 00:28:21,910 --> 00:28:23,659 Speaker 2: 10 years ago, I told in 2015. 453 00:28:24,449 --> 00:28:32,449 Speaker 2: 10 years from now, Mercedes Benz, BMW, Audi, uh, Toyota, Nissan, oh, 454 00:28:33,329 --> 00:28:36,739 Speaker 2: we so scared of Chinese automobiles. You would have laughed 455 00:28:36,739 --> 00:28:39,609 Speaker 2: at me. Everybody would have laughed. You must be joking. 456 00:28:39,699 --> 00:28:44,489 Speaker 2: I remember as recently as 34 years ago, Elon Musk said, 457 00:28:44,849 --> 00:28:47,369 Speaker 2: who the hell is going to buy a Chinese automobile? 458 00:28:48,469 --> 00:28:52,459 Speaker 2: Look where we are today. All the companies I mentioned 459 00:28:53,060 --> 00:28:54,270 Speaker 2: are shit scared. 460 00:28:55,040 --> 00:28:59,238 Speaker 2: Of Chinese automobiles. So, you know, this is and, and 461 00:28:59,239 --> 00:29:02,709 Speaker 2: just to mention an event that happened last few days. 462 00:29:03,660 --> 00:29:06,969 Speaker 2: Look at how much value Nasdaq has lost. 463 00:29:07,780 --> 00:29:10,910 Speaker 2: Because of a company I never heard of called Deep. 464 00:29:12,459 --> 00:29:14,410 Speaker 2: Where did this Chinese company come from? 465 00:29:15,270 --> 00:29:19,050 Speaker 2: And how does a hedge fund manager create a world 466 00:29:19,050 --> 00:29:23,839 Speaker 2: beating AI company? It doesn't make sense. So, you know, therefore, 467 00:29:24,790 --> 00:29:27,390 Speaker 2: What, what we have, the biggest lesson, and this is 468 00:29:27,390 --> 00:29:29,270 Speaker 2: what I, you know, I, I'm a friend of the 469 00:29:29,270 --> 00:29:32,979 Speaker 2: United States. My goal is to help the United States 470 00:29:32,979 --> 00:29:37,890 Speaker 2: adapt intelligently to the rise of the Chinese. And I 471 00:29:37,890 --> 00:29:42,609 Speaker 2: always keep telling my American friends, it's, it's very dangerous 472 00:29:42,609 --> 00:29:46,670 Speaker 2: for you to underestimate China. It's safer for you to 473 00:29:46,670 --> 00:29:49,270 Speaker 2: overestimate China and to be fair to me, I've been 474 00:29:49,270 --> 00:29:52,390 Speaker 2: saying this for 2030 years, consistently. 475 00:29:53,160 --> 00:29:58,890 Speaker 2: And so if the structural changes happening, the rebalancing between 476 00:29:58,890 --> 00:30:03,800 Speaker 2: US and China will continue. Now over the short term, uh, 477 00:30:03,810 --> 00:30:06,050 Speaker 2: I think China is probably going to have a rough 478 00:30:06,050 --> 00:30:10,410 Speaker 2: time initially, uh, with Donald Trump because Donald Trump is, 479 00:30:10,489 --> 00:30:14,099 Speaker 2: you know, only believes in working through threats and uh 480 00:30:14,099 --> 00:30:16,130 Speaker 2: tariffs and so on and so forth. So there'll be 481 00:30:16,130 --> 00:30:21,089 Speaker 2: some rockiness in the US China relationship, but at the 482 00:30:21,089 --> 00:30:21,969 Speaker 2: same time, 483 00:30:22,680 --> 00:30:26,959 Speaker 2: If there's one man who can make a deal with China, 484 00:30:27,160 --> 00:30:32,040 Speaker 2: comprehensive deal with China, it is certainly Donald Trump. You know, 485 00:30:32,199 --> 00:30:36,520 Speaker 2: you know, Joe Biden and his administration were so frightened 486 00:30:36,520 --> 00:30:39,310 Speaker 2: of being seen to be soft on China, they didn't 487 00:30:39,310 --> 00:30:41,560 Speaker 2: dare to do even the obvious things they could have 488 00:30:41,560 --> 00:30:44,479 Speaker 2: done to improve ties with China. Donald 489 00:30:44,594 --> 00:30:46,994 Speaker 2: Trump has got the advantage. They say only, you know, 490 00:30:47,074 --> 00:30:50,314 Speaker 2: they say only Richard Nixon could go to China, only 491 00:30:50,314 --> 00:30:53,354 Speaker 2: Donald Trump can make a deal with China. And at 492 00:30:53,354 --> 00:30:56,114 Speaker 2: some point in time, if they reach a deal of 493 00:30:56,114 --> 00:31:00,714 Speaker 2: some kind and stabilize the US-China relationship, that wouldn't be 494 00:31:00,714 --> 00:31:04,435 Speaker 2: surprised either. So, and this means that all the other 495 00:31:04,435 --> 00:31:07,435 Speaker 2: people around the world, like the Europeans. 496 00:31:08,229 --> 00:31:13,270 Speaker 2: Who are counting on an adversarial US China relationship will 497 00:31:13,270 --> 00:31:15,819 Speaker 2: suddenly find themselves marginalized. 498 00:31:16,859 --> 00:31:18,500 Speaker 2: So this is the sort of thing that you got 499 00:31:18,500 --> 00:31:21,869 Speaker 2: to be very geopolitics is a very cruel business. You 500 00:31:21,869 --> 00:31:24,900 Speaker 2: got to think very hard about how you could, on 501 00:31:24,900 --> 00:31:27,738 Speaker 2: the one hand, enhance your position, and on the other hand, 502 00:31:27,859 --> 00:31:32,020 Speaker 2: how your position could be seriously suffer if other changes happen. 503 00:31:32,530 --> 00:31:36,619 Speaker 1: Like sure, the mercurial nature of Trump is really something else. 504 00:31:37,109 --> 00:31:40,469 Speaker 1: To your point of the Biden administration being petrified of 505 00:31:40,469 --> 00:31:43,790 Speaker 1: being seen soft on China, they basically co-opted all the 506 00:31:43,790 --> 00:31:47,540 Speaker 1: measures that Trump had put in place, and they intensified them, 507 00:31:48,069 --> 00:31:51,099 Speaker 1: including the ban on TikTok, and then Trump comes back 508 00:31:51,270 --> 00:31:54,010 Speaker 1: and he says, yeah, maybe we shouldn't ban it. Um, 509 00:31:54,189 --> 00:31:56,349 Speaker 1: so what was the point of trying to look even 510 00:31:56,349 --> 00:31:58,949 Speaker 1: holier than thou for the Biden administration, it didn't really 511 00:31:58,949 --> 00:31:59,709 Speaker 1: amount to anything. 512 00:32:00,199 --> 00:32:01,939 Speaker 1: Um, but just saying it, 513 00:32:02,199 --> 00:32:05,630 Speaker 2: just a quick point, the bigger problem with the Biden administration. 514 00:32:06,550 --> 00:32:10,270 Speaker 2: Is that they didn't have long term strategic thinkers in 515 00:32:10,270 --> 00:32:14,699 Speaker 2: the administration. I can tell you that in my last, uh, 516 00:32:14,829 --> 00:32:20,939 Speaker 2: one on one conversation, uh, with Henry Kissinger in October 2022, 517 00:32:21,380 --> 00:32:25,180 Speaker 2: about a year before he died, he more or less, uh, 518 00:32:25,229 --> 00:32:27,630 Speaker 2: suggested that, you know, they're not thinking long term and 519 00:32:27,630 --> 00:32:30,988 Speaker 2: competing with China, you got to ask yourself where you 520 00:32:30,989 --> 00:32:33,069 Speaker 2: want to be 10 years, 20 years from now, forget 521 00:32:33,069 --> 00:32:33,989 Speaker 2: the next quarter. 522 00:32:34,560 --> 00:32:37,189 Speaker 2: Forget the tariffs and all that. Where, what is your 523 00:32:37,189 --> 00:32:40,880 Speaker 2: end goal? And the Biden administration never specified what his 524 00:32:40,880 --> 00:32:43,719 Speaker 2: end goal is going to be 10 years, 20 years 525 00:32:43,719 --> 00:32:47,119 Speaker 2: down the road. And, and, and what it shocked me 526 00:32:47,119 --> 00:32:50,209 Speaker 2: even more is that not a single member of the 527 00:32:50,209 --> 00:32:51,988 Speaker 2: Biden administration. 528 00:32:52,880 --> 00:32:55,339 Speaker 2: Consulted Henry Kissinger. 529 00:32:56,270 --> 00:32:58,959 Speaker 2: And the least they could have done, at least I 530 00:32:58,959 --> 00:33:00,339 Speaker 2: mean to show some courage. 531 00:33:01,089 --> 00:33:04,040 Speaker 2: It allowed Henry Kissinger to go back to China in 532 00:33:04,040 --> 00:33:08,479 Speaker 2: 2021 to mark the 50th anniversary of the opening up 533 00:33:08,479 --> 00:33:12,119 Speaker 2: with China, but they were so scared, they didn't even 534 00:33:12,119 --> 00:33:15,329 Speaker 2: allow Kissinger to go to China. So that's an example 535 00:33:15,329 --> 00:33:20,109 Speaker 2: of cowardice that unfortunately plagued the Biden administration. 536 00:33:20,479 --> 00:33:23,359 Speaker 1: Yeah, I've I've looked at various speeches that Jake Sullivan 537 00:33:23,359 --> 00:33:25,510 Speaker 1: and Anthony Blinken gave over the last 4 years. 538 00:33:25,819 --> 00:33:28,420 Speaker 1: And I felt that it was a continuation of whatever 539 00:33:28,420 --> 00:33:30,869 Speaker 1: they thought the Trump administration had done that we're going 540 00:33:30,869 --> 00:33:32,900 Speaker 1: to be even tougher than that of wide yard and 541 00:33:32,900 --> 00:33:35,099 Speaker 1: high fence and those sort of analogy. It was all 542 00:33:35,099 --> 00:33:38,569 Speaker 1: about looking at China as an existential adversary, as opposed 543 00:33:38,569 --> 00:33:42,089 Speaker 1: to looking at the gains from a win-win relationship of openness. 544 00:33:42,380 --> 00:33:44,979 Speaker 2: And and the Biden administration especially. 545 00:33:46,180 --> 00:33:49,819 Speaker 2: Because it genuinely, the biggest compliment I can pay the 546 00:33:49,819 --> 00:33:53,859 Speaker 2: Biden administration is that they understood that climate change was 547 00:33:53,859 --> 00:33:56,689 Speaker 2: a real threat and it is a real threat, come on. 548 00:33:57,579 --> 00:34:00,459 Speaker 2: Like climate change is a real threat and you really 549 00:34:00,459 --> 00:34:02,900 Speaker 2: want to focus on saving planet Earth. 550 00:34:03,869 --> 00:34:06,390 Speaker 2: Then you've got to press the pause button on the 551 00:34:06,390 --> 00:34:10,110 Speaker 2: geopolitical contest with China and tell China, hey, they are 552 00:34:10,110 --> 00:34:13,090 Speaker 2: both two cabins on one boat, the boat is sinking, 553 00:34:13,469 --> 00:34:17,549 Speaker 2: let's work together. But the Biden administration, even though it 554 00:34:17,870 --> 00:34:21,800 Speaker 2: realized that climate change is real, didn't have the courage 555 00:34:21,800 --> 00:34:25,159 Speaker 2: to tell the American people, hey, we really got to 556 00:34:25,159 --> 00:34:26,909 Speaker 2: save the planet, and the only way we can save 557 00:34:26,909 --> 00:34:28,870 Speaker 2: the planet if all of us come together, and we 558 00:34:28,870 --> 00:34:30,178 Speaker 2: must bring China on board. 559 00:34:30,610 --> 00:34:33,969 Speaker 2: That's a very simple, obvious thing the Biden administration could 560 00:34:33,969 --> 00:34:36,770 Speaker 2: have said, but all they wanted to show is that 561 00:34:36,770 --> 00:34:40,090 Speaker 2: they were tougher on China than the Trump administration, and 562 00:34:40,090 --> 00:34:41,408 Speaker 2: it was a losing game, I 563 00:34:41,409 --> 00:34:45,049 Speaker 1: agree. Um, let's go back to the point you made 564 00:34:45,050 --> 00:34:49,229 Speaker 1: about Xi Jinping's speech about China, you know, jumping into 565 00:34:49,229 --> 00:34:52,479 Speaker 1: the rough waters of globalization and coming out stronger. 566 00:34:53,289 --> 00:34:57,128 Speaker 1: If we assume that the narrative of fragmentation continues in 567 00:34:57,128 --> 00:35:00,248 Speaker 1: the US and Europe, they see China as an adversary 568 00:35:00,248 --> 00:35:04,038 Speaker 1: and they restrict market access, technology access, and so on. 569 00:35:04,368 --> 00:35:07,448 Speaker 1: What is China's strategy vis a vis the other 85% 570 00:35:07,448 --> 00:35:08,138 Speaker 1: of the world? 571 00:35:08,849 --> 00:35:11,688 Speaker 2: Well, I think that China's strategy vis a vis the 572 00:35:11,688 --> 00:35:16,248 Speaker 2: other 85% of the world started more than 10 years ago. 573 00:35:17,219 --> 00:35:21,250 Speaker 2: I mean, with things like the Belt and Road Initiative, 574 00:35:21,739 --> 00:35:27,729 Speaker 2: the Asian Infrastructure Investment Bank, the New Development Bank, you know, 575 00:35:28,100 --> 00:35:32,739 Speaker 2: and you know, uh, a Brazilian diplomat told me that 576 00:35:32,899 --> 00:35:36,739 Speaker 2: in the year 2000, it took Brazil one year. 577 00:35:37,449 --> 00:35:39,879 Speaker 2: To export $1 billion to China. 578 00:35:40,929 --> 00:35:45,810 Speaker 2: Today it take Brazil 60 to 70 hours to export 579 00:35:45,810 --> 00:35:49,739 Speaker 2: $1 billion to China. So, you know, remember, Brazil is 580 00:35:49,739 --> 00:35:53,820 Speaker 2: in theory in the American sphere of influence, and Brazil 581 00:35:53,820 --> 00:35:56,399 Speaker 2: is covered by the Monroe Doctrine and so on and 582 00:35:56,399 --> 00:36:00,100 Speaker 2: so forth. So here is a country that has developed 583 00:36:00,100 --> 00:36:03,770 Speaker 2: extensive ties with China. It's not going to sacrifice, uh, 584 00:36:03,780 --> 00:36:07,330 Speaker 2: it ties with China just because of uh the United States. 585 00:36:07,830 --> 00:36:11,229 Speaker 2: So, what what the Chinese have done, therefore vis a 586 00:36:11,229 --> 00:36:16,360 Speaker 2: vis the 85%, is to enhance their substantive ties with 587 00:36:16,360 --> 00:36:21,270 Speaker 2: these countries. And another give you another example, Indonesia, you know, 588 00:36:21,320 --> 00:36:23,750 Speaker 2: when after Indonesia made a decision. 589 00:36:24,530 --> 00:36:28,609 Speaker 2: To, uh, build a fast train with China between Jakarta 590 00:36:28,610 --> 00:36:32,469 Speaker 2: and Bandung, the Biden administration sent a team and said, 591 00:36:32,590 --> 00:36:36,509 Speaker 2: you know, be careful, be careful. And the Indonesian response was, OK, 592 00:36:36,750 --> 00:36:38,709 Speaker 2: why don't you, America, come and build a fast train 593 00:36:38,709 --> 00:36:41,989 Speaker 2: in Indonesia. You'll be happy if you did so. But 594 00:36:41,989 --> 00:36:46,100 Speaker 2: you know, again, the US couldn't compete with China on that. So, I, 595 00:36:46,229 --> 00:36:50,270 Speaker 2: I think therefore, the Chinese have, in the Chinese have 596 00:36:50,270 --> 00:36:50,610 Speaker 2: had 597 00:36:51,429 --> 00:36:53,790 Speaker 2: As I, as I explained in my book as China One, 598 00:36:54,310 --> 00:37:00,360 Speaker 2: a consistent long term strategy on how to manage pressures 599 00:37:00,360 --> 00:37:04,149 Speaker 2: from China, from United States and China, and the best 600 00:37:04,149 --> 00:37:06,750 Speaker 2: way to do so is to ensure that the rest 601 00:37:06,750 --> 00:37:11,389 Speaker 2: of the world uh has a vested interest in not 602 00:37:11,389 --> 00:37:15,520 Speaker 2: cutting off China. That's a strategic decision they made ages ago, 603 00:37:15,560 --> 00:37:16,909 Speaker 2: when you see this in ASEAN. 604 00:37:17,550 --> 00:37:20,870 Speaker 2: Uh, for example, in the year 2000, China ASEAN trade 605 00:37:20,870 --> 00:37:25,229 Speaker 2: was only $40 billion US dollars. In 2022, it hit 606 00:37:25,229 --> 00:37:29,949 Speaker 2: $975 billion you know, almost $1 trillion. So all this 607 00:37:29,949 --> 00:37:33,750 Speaker 2: interdependency between China and the rest of the world means 608 00:37:33,750 --> 00:37:38,830 Speaker 2: that they have preemptively, China has preemptively killed any containment strategy. 609 00:37:39,540 --> 00:37:43,179 Speaker 2: Uh, by the United States and see, by contrast, the 610 00:37:43,179 --> 00:37:50,100 Speaker 2: United States doesn't have a long term policy that can counterbalance, uh, uh, China, 611 00:37:50,540 --> 00:37:52,939 Speaker 2: and actually what the United States has now with the 612 00:37:52,939 --> 00:37:55,340 Speaker 2: Trump administration is the exact opposite. 613 00:37:56,189 --> 00:38:00,929 Speaker 2: Because Trump is actually in one way or another, going 614 00:38:00,929 --> 00:38:03,649 Speaker 2: to alienate a lot of countries in the world. I'm 615 00:38:03,649 --> 00:38:07,049 Speaker 2: sure Canada is mad as hell. I'm sure Mexico is 616 00:38:07,050 --> 00:38:10,360 Speaker 2: mad as hell. Colombia, I'm sure is not mad as hell, 617 00:38:10,689 --> 00:38:11,209 Speaker 2: even though it. 618 00:38:11,735 --> 00:38:13,764 Speaker 2: In the end, you know, when people have to cut out, 619 00:38:13,804 --> 00:38:19,235 Speaker 2: they get mad, of course. Uh, so, uh, you ironically, 620 00:38:19,685 --> 00:38:24,685 Speaker 2: if Trump goes systematically threatening country by country systematically, including 621 00:38:24,685 --> 00:38:30,245 Speaker 2: friends like Japan and South Korea, then frankly, the Trump 622 00:38:30,245 --> 00:38:33,844 Speaker 2: could be a real gift to China that keeps on giving. 623 00:38:35,280 --> 00:38:39,330 Speaker 1: But in terms of China, so nobody contest the fact that, 624 00:38:39,340 --> 00:38:43,178 Speaker 1: you know, China has deepened economic symbalances with vast parts 625 00:38:43,179 --> 00:38:47,840 Speaker 1: of the global South, but is it doing the prudent 626 00:38:47,840 --> 00:38:50,659 Speaker 1: thing in South China Sea, for example, we see Philippines, 627 00:38:50,820 --> 00:38:54,260 Speaker 1: China friction, sometimes Vietnam, China friction, and of course we 628 00:38:54,260 --> 00:38:57,620 Speaker 1: have the Taiwan, Korea, Japan uh situation uh vis a 629 00:38:57,620 --> 00:38:58,489 Speaker 1: vis China as well. 630 00:38:58,840 --> 00:39:01,979 Speaker 1: So what's your assessment of China's sort of the wool 631 00:39:01,979 --> 00:39:04,959 Speaker 1: for your past or is it sort of being a 632 00:39:04,959 --> 00:39:07,639 Speaker 1: little more pragmatic and dealing with his immediate neighbors? 633 00:39:07,760 --> 00:39:11,479 Speaker 2: Well, I mean, uh, the key point I always emphasize 634 00:39:11,479 --> 00:39:15,209 Speaker 2: about when you deal with great power, great powers, always 635 00:39:15,209 --> 00:39:19,399 Speaker 2: remember that the phrase benevolent great power is an oxymoron. 636 00:39:20,419 --> 00:39:24,580 Speaker 2: No great power is is is benevolent. I mean, the 637 00:39:24,580 --> 00:39:27,569 Speaker 2: United States was in some ways benevolent after World War 638 00:39:27,570 --> 00:39:30,060 Speaker 2: 2 and so on and so forth with the Marshall 639 00:39:30,060 --> 00:39:32,320 Speaker 2: Plan and all that. But as you can see, in 640 00:39:32,320 --> 00:39:35,419 Speaker 2: the long run, every great power will put its interests 641 00:39:35,419 --> 00:39:39,340 Speaker 2: first and sacrifice others. As you know, the Europeans are terrified. 642 00:39:39,989 --> 00:39:44,159 Speaker 2: Uh, are being abandoned in Ukraine now. Uh, so in 643 00:39:44,159 --> 00:39:47,020 Speaker 2: the same way, China is also not a benevolent great power. 644 00:39:47,100 --> 00:39:51,500 Speaker 2: It has to put its own, uh, interests first. And 645 00:39:51,500 --> 00:39:57,219 Speaker 2: there's no question that as China becomes more and more powerful, uh, 646 00:39:57,340 --> 00:40:00,020 Speaker 2: it is going to become more and more assertive. I mean, 647 00:40:00,179 --> 00:40:03,779 Speaker 2: you know, if I give a simple analogy, if you 648 00:40:03,780 --> 00:40:06,500 Speaker 2: and I having this conversation for an hour, we started 649 00:40:06,500 --> 00:40:08,219 Speaker 2: off by having a cat in the room, sitting in 650 00:40:08,219 --> 00:40:08,780 Speaker 2: the corner. 651 00:40:09,090 --> 00:40:12,179 Speaker 2: You and I will be talking very comfortably. What a 652 00:40:12,179 --> 00:40:15,020 Speaker 2: lovely cat, you know, you can look at it. But 653 00:40:15,020 --> 00:40:18,340 Speaker 2: after an hour, suddenly the cat becomes a tiger. I 654 00:40:18,340 --> 00:40:20,780 Speaker 2: think you and I would sit here very uncomfortably looking 655 00:40:20,780 --> 00:40:24,820 Speaker 2: at the tiger, you know. So China, to put it simply, 656 00:40:25,060 --> 00:40:28,340 Speaker 2: I mean, mathematically, this is true, has gone from being 657 00:40:28,340 --> 00:40:32,260 Speaker 2: a cat to becoming a tiger, right? Look at how 658 00:40:32,260 --> 00:40:35,770 Speaker 2: much the economy has exploded. And so you can no 659 00:40:35,770 --> 00:40:37,260 Speaker 2: longer assume. 660 00:40:38,070 --> 00:40:40,459 Speaker 2: That the china that behave like a cat. 661 00:40:41,370 --> 00:40:44,370 Speaker 2: It's going to continue behaving like a cat when it 662 00:40:44,370 --> 00:40:47,569 Speaker 2: becomes a tiger. That's so unrealistic. It's going to become 663 00:40:47,570 --> 00:40:51,250 Speaker 2: more assertive. But at the same time, there's a huge 664 00:40:51,250 --> 00:40:54,889 Speaker 2: difference between two English words. One is assertive and the 665 00:40:54,889 --> 00:40:59,080 Speaker 2: other is aggressive. So China can become more assertive without 666 00:40:59,080 --> 00:41:03,850 Speaker 2: necessarily becoming aggressive. Now, you mentioned the South China Sea. 667 00:41:04,489 --> 00:41:08,408 Speaker 2: Just go and read uh Graham Allison's book Destined for 668 00:41:08,409 --> 00:41:13,439 Speaker 2: War on US-China relations, where he says Americans keep wishing, 669 00:41:13,610 --> 00:41:17,770 Speaker 2: why can't China be like us? He said Americans should 670 00:41:17,770 --> 00:41:21,239 Speaker 2: stop wishing that China be like us because China today. 671 00:41:22,000 --> 00:41:25,219 Speaker 2: In the 2020s is where the United States was in 672 00:41:25,219 --> 00:41:29,550 Speaker 2: the 1890s and the president then, by the way, was McKinley, 673 00:41:29,979 --> 00:41:34,100 Speaker 2: whom Trump reveres. What did he do? Once you got 674 00:41:34,100 --> 00:41:35,100 Speaker 2: the muscles. 675 00:41:35,780 --> 00:41:40,060 Speaker 2: You declare war in Spain. You seize Philippines, you seize 676 00:41:40,810 --> 00:41:45,639 Speaker 2: uh Puerto Rico, you, you seize Guam, you, you, you, you, 677 00:41:45,689 --> 00:41:48,850 Speaker 2: you seize Cuba and so on and so forth. I mean, 678 00:41:48,929 --> 00:41:53,280 Speaker 2: that's what great powers do. Now, I can tell you this, 679 00:41:53,689 --> 00:41:56,090 Speaker 2: there are lots of features in the South China Sea. 680 00:41:57,050 --> 00:42:01,189 Speaker 2: If tomorrow China decided that it should occupy all of them, 681 00:42:01,270 --> 00:42:04,350 Speaker 2: it could do so in 24 hours. Everyone knows that, 682 00:42:04,629 --> 00:42:05,870 Speaker 2: no question whatsoever. 683 00:42:06,620 --> 00:42:10,949 Speaker 2: And the question therefore is why hasn't China done that 684 00:42:10,949 --> 00:42:12,189 Speaker 2: on the South China Sea? 685 00:42:13,010 --> 00:42:15,280 Speaker 2: And the here. 686 00:42:16,149 --> 00:42:18,589 Speaker 2: When you look, look at all the discussions on the 687 00:42:18,590 --> 00:42:22,459 Speaker 2: South China Sea, in theory, the problems are within China 688 00:42:22,459 --> 00:42:28,989 Speaker 2: and the four ASEAN countries, Philippines, Malaysia, Vietnam, and Brunei. 689 00:42:29,830 --> 00:42:32,698 Speaker 2: All the discussion of South China Sea in the Anglo-Saxon media. 690 00:42:33,520 --> 00:42:36,448 Speaker 2: The South China Sea, the ASEAN countries are keeping very 691 00:42:36,449 --> 00:42:39,060 Speaker 2: quiet because they know they have to in some ways 692 00:42:39,060 --> 00:42:41,540 Speaker 2: or another get along and work with China and find 693 00:42:41,780 --> 00:42:44,698 Speaker 2: adjustments with them. And it doesn't mean that they kowtow 694 00:42:44,699 --> 00:42:47,179 Speaker 2: to China, but they also know that you got to 695 00:42:47,179 --> 00:42:50,100 Speaker 2: stand up with China, which Vietnam is doing all the time, 696 00:42:50,169 --> 00:42:53,020 Speaker 2: but you don't have to do so publicly, right? And 697 00:42:53,020 --> 00:42:57,620 Speaker 2: the problem with the Philippines is that you notice that 698 00:42:57,899 --> 00:43:01,379 Speaker 2: when you deal with the rising power as a neighbor. 699 00:43:02,090 --> 00:43:05,479 Speaker 2: The most important thing every country in Southeast Asia should 700 00:43:05,479 --> 00:43:09,540 Speaker 2: have is a consistent long term policy in managing your 701 00:43:09,540 --> 00:43:13,199 Speaker 2: big neighbor. When you vaccinate, you create confusion and, and, 702 00:43:13,209 --> 00:43:19,580 Speaker 2: and uncertainty, and the Philippines has gone from uh Maloria 703 00:43:19,580 --> 00:43:26,219 Speaker 2: Macapagal Arrayo pro-China to Akino pro US to Duterte, pro-China, 704 00:43:26,300 --> 00:43:30,600 Speaker 2: to now Marcos, pro-S. Now that inconsistency. 705 00:43:31,250 --> 00:43:35,739 Speaker 2: Uh, becomes a challenge in, in geopolitics. You know, you're creating, 706 00:43:35,810 --> 00:43:39,928 Speaker 2: you're creating unnecessary problems. So my, I, I've told my 707 00:43:39,929 --> 00:43:41,689 Speaker 2: Filipino friends, sit down. 708 00:43:42,350 --> 00:43:45,860 Speaker 2: And work out a consistent long-term policy on China where 709 00:43:45,860 --> 00:43:50,178 Speaker 2: you defend your interest, but make it bipartisan and stick 710 00:43:50,179 --> 00:43:53,060 Speaker 2: to it over the long term. And don't flip and 711 00:43:53,060 --> 00:43:57,310 Speaker 2: switch every 4 to 5 years because it's not healthy. 712 00:43:57,580 --> 00:44:00,540 Speaker 2: At the end of the day, Philippines has got to 713 00:44:00,540 --> 00:44:04,100 Speaker 2: find a way of living with your big neighbor. and 714 00:44:04,560 --> 00:44:07,300 Speaker 2: and and the rule of history is that if you 715 00:44:07,300 --> 00:44:11,179 Speaker 2: have a big neighbor, uh, you adjust to the big neighbor. 716 00:44:11,780 --> 00:44:14,000 Speaker 2: And the big neighbor doesn't adjust to you. By the way, in, 717 00:44:14,080 --> 00:44:17,149 Speaker 2: in just to, just for, just to confirm this, a 718 00:44:17,149 --> 00:44:20,479 Speaker 2: good friend of mine was a champion sailor. 719 00:44:21,540 --> 00:44:25,179 Speaker 2: And she says when you're, when you're on a sailboat. 720 00:44:26,020 --> 00:44:28,020 Speaker 2: And you see a big boat, right? 721 00:44:28,870 --> 00:44:31,750 Speaker 2: Even if in theory you have the right of way 722 00:44:32,320 --> 00:44:35,159 Speaker 2: and the big boat has to give way, there's something 723 00:44:35,159 --> 00:44:39,060 Speaker 2: called the big boat rules. The big boat rules, you, 724 00:44:39,199 --> 00:44:42,310 Speaker 2: you move aside, because if you ram into the big boat, 725 00:44:42,840 --> 00:44:46,629 Speaker 2: the big boat carries on and your yacht is sunk. Yes, so, 726 00:44:46,669 --> 00:44:50,120 Speaker 2: you know, so it's a reality of life and, and, 727 00:44:50,159 --> 00:44:54,439 Speaker 2: and to pretend that you, you can deal with the 728 00:44:54,439 --> 00:44:56,590 Speaker 2: power that is so much more powerful. 729 00:44:57,189 --> 00:45:01,899 Speaker 2: Uh, as an equal, it's a very dangerous geopolitical illusion. 730 00:45:02,159 --> 00:45:03,908 Speaker 2: But it doesn't mean, I want to emphasize, it doesn't 731 00:45:03,909 --> 00:45:05,989 Speaker 2: mean you cut out, give way, and so on and 732 00:45:05,989 --> 00:45:09,549 Speaker 2: so forth, but you manage the great power in such 733 00:45:09,550 --> 00:45:13,330 Speaker 2: an intelligent way. You persuade them that it's in their 734 00:45:13,330 --> 00:45:16,138 Speaker 2: interest to work with you and you're not hostile to them, 735 00:45:16,429 --> 00:45:18,709 Speaker 2: and yet at the same time you tell them very clearly, 736 00:45:18,790 --> 00:45:21,709 Speaker 2: these are my core interests and please don't touch them. 737 00:45:22,550 --> 00:45:26,139 Speaker 1: I experienced the rule of big boats recently I was 738 00:45:26,139 --> 00:45:28,820 Speaker 1: canoeing from Palau went back to Singapore. When the big 739 00:45:28,820 --> 00:45:30,939 Speaker 1: tugboats come, it doesn't matter whether you have the right 740 00:45:30,939 --> 00:45:32,659 Speaker 1: of way, you get out of their way because they 741 00:45:32,659 --> 00:45:34,899 Speaker 1: cannot stop for you. But sure, I want to stay 742 00:45:34,899 --> 00:45:37,469 Speaker 1: with the tiger analogy for a second. US has been 743 00:45:37,469 --> 00:45:40,379 Speaker 1: a big tiger in the global neighborhood for a century 744 00:45:40,379 --> 00:45:44,209 Speaker 1: or so, um, and the US soft power has been 745 00:45:44,209 --> 00:45:46,780 Speaker 1: so powerful in keeping the rest of the world at 746 00:45:46,780 --> 00:45:50,810 Speaker 1: ease with the US. The recent experience notwithstanding Hollywood. 747 00:45:51,350 --> 00:45:55,589 Speaker 1: Books, US companies and their brands. So isn't it in 748 00:45:55,590 --> 00:45:59,989 Speaker 1: China's interest to project soft power in a more benign way, 749 00:46:00,070 --> 00:46:04,020 Speaker 1: so that even if the benevolent superpower oxymoron is true, 750 00:46:04,310 --> 00:46:07,739 Speaker 1: there's a little more adaptability and a little more uh 751 00:46:07,739 --> 00:46:10,229 Speaker 1: positivity associated with dealing with China. 752 00:46:11,060 --> 00:46:14,299 Speaker 2: Well, I think uh there's no question that the US 753 00:46:14,300 --> 00:46:15,889 Speaker 2: has a lot of soft power. 754 00:46:16,560 --> 00:46:20,570 Speaker 2: I mean, uh, if you ask the brightest young people 755 00:46:20,570 --> 00:46:22,529 Speaker 2: in any corner of the world. 756 00:46:23,129 --> 00:46:28,350 Speaker 2: In Latin America, in Africa, in South Asia, in Southeast Asia. 757 00:46:29,080 --> 00:46:33,270 Speaker 2: Uh, even in East Asia, you know, if you're bright, young, ambitious, 758 00:46:33,760 --> 00:46:36,199 Speaker 2: which country do you want to go to and where 759 00:46:36,199 --> 00:46:39,290 Speaker 2: can you make this become enormously successful? 760 00:46:39,969 --> 00:46:45,179 Speaker 2: You can't do that in China. I mean, Brazilian, Nigerian, Indonesian, 761 00:46:45,790 --> 00:46:49,350 Speaker 2: very rarely can succeed in in China, but you can 762 00:46:49,350 --> 00:46:54,350 Speaker 2: succeed in uh United States and exhibit A, people like 763 00:46:54,350 --> 00:46:57,709 Speaker 2: Elon Musk, Satya Nadella, Sundar Pichai, and so on and 764 00:46:57,709 --> 00:47:00,709 Speaker 2: so forth. So in that sense, the United States has 765 00:47:00,709 --> 00:47:04,469 Speaker 2: real soft power in terms of attracting the brightest and 766 00:47:04,469 --> 00:47:07,179 Speaker 2: the best to come to the United States. 767 00:47:07,679 --> 00:47:10,260 Speaker 2: But you got to make soft power is going to 768 00:47:10,260 --> 00:47:11,659 Speaker 2: be dissected, OK? 769 00:47:12,280 --> 00:47:14,489 Speaker 2: In the past, the United States had a lot of 770 00:47:14,489 --> 00:47:19,370 Speaker 2: soft power with the mass populations and also with the 771 00:47:19,370 --> 00:47:22,919 Speaker 2: governments of the world. Most governments of the world in 772 00:47:22,919 --> 00:47:25,489 Speaker 2: one way, especially during the Cold War, and I can 773 00:47:25,489 --> 00:47:28,969 Speaker 2: say this because I worked very, very closely with American diplomats, 774 00:47:29,739 --> 00:47:32,889 Speaker 2: with American diplomats in the Cold War. Government to government 775 00:47:32,889 --> 00:47:36,290 Speaker 2: relations were also very close. You could trust the United States. 776 00:47:36,750 --> 00:47:39,649 Speaker 2: And the United States will always try to listen to 777 00:47:39,649 --> 00:47:42,209 Speaker 2: you and deal with you and understand your concerns and 778 00:47:42,209 --> 00:47:46,729 Speaker 2: all that. Uh, and you know, the height of that 779 00:47:46,729 --> 00:47:49,250 Speaker 2: I saw when Mr. Lee Kuan Yew went to United 780 00:47:49,250 --> 00:47:53,100 Speaker 2: States in 1985 and gave a speech at the joint 781 00:47:53,100 --> 00:47:56,169 Speaker 2: session of the US Congress saying thank you, United States 782 00:47:56,169 --> 00:48:01,820 Speaker 2: for creating a rules-based order whereby you guarantee us that 783 00:48:01,820 --> 00:48:04,290 Speaker 2: small states can grow and thrive and do well, right? 784 00:48:05,100 --> 00:48:08,779 Speaker 2: So you, they have soft powered individuals and soft power 785 00:48:08,780 --> 00:48:11,739 Speaker 2: with governments. Now I would say the soft power with 786 00:48:11,739 --> 00:48:16,419 Speaker 2: individuals still remains. Uh, people still believe, still dream of 787 00:48:16,419 --> 00:48:18,770 Speaker 2: going to the United States to live and work in. 788 00:48:19,340 --> 00:48:21,689 Speaker 2: But I would say the soft power with governments is 789 00:48:21,689 --> 00:48:23,339 Speaker 2: at an all-time low. 790 00:48:24,260 --> 00:48:27,020 Speaker 2: Because especially, and this is where Donald Trump is going 791 00:48:27,020 --> 00:48:30,899 Speaker 2: to do the biggest amount of damage, because Donald Trump's 792 00:48:30,899 --> 00:48:34,500 Speaker 2: message to every country is, I don't care what you've 793 00:48:34,500 --> 00:48:38,330 Speaker 2: done for me in the past. That's irrelevant to me. 794 00:48:38,699 --> 00:48:40,739 Speaker 2: What have you done for me lately? 795 00:48:41,409 --> 00:48:47,159 Speaker 2: And also in a more fundamental way, the rules that Mr. 796 00:48:47,169 --> 00:48:51,010 Speaker 2: Lee Kuan Yeww praised the United States for creating, one 797 00:48:51,010 --> 00:48:54,209 Speaker 2: of the rules is you respect the territorial integrity of 798 00:48:54,209 --> 00:48:59,939 Speaker 2: sovereign states. Trump is overthrowing. He's telling Panama, your canal 799 00:48:59,939 --> 00:49:03,919 Speaker 2: belongs to me. He's telling Denmark, Greenland belongs to me. 800 00:49:05,340 --> 00:49:08,669 Speaker 2: Now, I can tell you that every government around the 801 00:49:08,669 --> 00:49:09,620 Speaker 2: world is asking. 802 00:49:10,800 --> 00:49:13,600 Speaker 2: What happens if Trump comes and says, I want a 803 00:49:13,600 --> 00:49:14,729 Speaker 2: slice of this from you? 804 00:49:17,830 --> 00:49:18,919 Speaker 2: How are you going to 805 00:49:19,909 --> 00:49:21,649 Speaker 2: Uh, tell him no, right? 806 00:49:22,419 --> 00:49:26,419 Speaker 2: And, and, you know, he's doing this to, not to 807 00:49:26,419 --> 00:49:28,489 Speaker 2: erstwhile adversaries. 808 00:49:29,320 --> 00:49:32,000 Speaker 2: Uh, of the United States. I mean, if he was 809 00:49:32,000 --> 00:49:36,639 Speaker 2: doing this to North Korea or Iran, uh, you can 810 00:49:36,639 --> 00:49:39,239 Speaker 2: understand this. He's doing, I mean, I can't think of 811 00:49:39,239 --> 00:49:40,109 Speaker 2: two countries. 812 00:49:40,760 --> 00:49:46,709 Speaker 2: That reveal the United States as much as the Canadian 813 00:49:46,709 --> 00:49:49,609 Speaker 2: and Danish governments that would have been the two governments 814 00:49:49,949 --> 00:49:54,719 Speaker 2: that would have revealed the United States. Now, United States. 815 00:49:55,780 --> 00:49:58,860 Speaker 2: Basically he's saying, excuse me. 816 00:49:59,560 --> 00:50:04,020 Speaker 2: You've been to my will, right? And just imagine if 817 00:50:04,020 --> 00:50:07,379 Speaker 2: China did the same thing with the Philippines, there will 818 00:50:07,379 --> 00:50:10,290 Speaker 2: be this huge uproar in the Anglo-Saxon media. 819 00:50:11,179 --> 00:50:12,989 Speaker 2: But the US is doing it. 820 00:50:16,639 --> 00:50:21,389 Speaker 1: So, finally, Yushu, um maybe we move away from China 821 00:50:21,389 --> 00:50:25,280 Speaker 1: um and come back to our little island of Singapore. Um, 822 00:50:26,040 --> 00:50:31,639 Speaker 1: Singapore's role in this world where China US relationships sometimes evolve, 823 00:50:31,919 --> 00:50:35,520 Speaker 1: sometimes deal making, but it is a challenging one. Singapore 824 00:50:35,520 --> 00:50:39,520 Speaker 1: wants to be open to everyone and uh it is conceivable, 825 00:50:39,639 --> 00:50:41,879 Speaker 1: not guaranteed, but conceivable that at some point Donald Trump 826 00:50:41,879 --> 00:50:44,840 Speaker 1: makes it difficult for Singapore to keep its open relationship 827 00:50:44,840 --> 00:50:45,919 Speaker 1: with China and others. 828 00:50:46,360 --> 00:50:50,029 Speaker 1: Um, what is Singapore's strategy in situations like this? 829 00:50:50,439 --> 00:50:55,799 Speaker 2: Well, I think the Singapore's strength, uh, is that is 830 00:50:55,800 --> 00:51:00,540 Speaker 2: the exact opposite of the Philippines. It's very consistent over 831 00:51:00,540 --> 00:51:01,158 Speaker 2: the long term. 832 00:51:02,360 --> 00:51:06,379 Speaker 2: Doesn't switch. So Prime Minister after Prime Minister after prime 833 00:51:06,379 --> 00:51:09,049 Speaker 2: minister has said, we want to be good friends with 834 00:51:09,050 --> 00:51:11,649 Speaker 2: the United States and we want to be good friends 835 00:51:11,649 --> 00:51:14,259 Speaker 2: with China. But it wasn't a problem when the United 836 00:51:14,260 --> 00:51:17,820 Speaker 2: States and China were getting along, but the first leader 837 00:51:17,820 --> 00:51:21,699 Speaker 2: in the world to come out openly to say that 838 00:51:21,699 --> 00:51:22,979 Speaker 2: we will not take sides. 839 00:51:23,919 --> 00:51:27,379 Speaker 2: In the in between United States and China was the 840 00:51:27,379 --> 00:51:31,219 Speaker 2: then Prime Minister, uh, Mr. Lee Hsien Loong, who said 841 00:51:31,219 --> 00:51:33,379 Speaker 2: at the Shangri-La Dialogue and who followed up with an 842 00:51:33,379 --> 00:51:36,779 Speaker 2: article in the magazine Foreign Affairs saying Singapore will be 843 00:51:36,780 --> 00:51:39,509 Speaker 2: friends with the US and Singapore be friends with China. 844 00:51:39,899 --> 00:51:43,459 Speaker 2: But at the same time, you see, Singaporeans are realistic 845 00:51:43,459 --> 00:51:48,139 Speaker 2: enough to know that it will not be easy, that 846 00:51:48,139 --> 00:51:50,299 Speaker 2: things will get more difficult. 847 00:51:50,870 --> 00:51:55,209 Speaker 2: Uh, especially with, uh, you know, a leader like Donald 848 00:51:55,209 --> 00:51:58,729 Speaker 2: Trump who doesn't care what you, what you did for 849 00:51:58,729 --> 00:52:03,049 Speaker 2: him many years ago. So I would say, therefore, that 850 00:52:03,050 --> 00:52:06,760 Speaker 2: Singapore has to be very, very careful. 851 00:52:07,540 --> 00:52:12,949 Speaker 2: Uh, and make sure that no event happens that triggers, 852 00:52:13,139 --> 00:52:17,399 Speaker 2: you know, uh, uh, a situation where you're, uh, forced 853 00:52:17,399 --> 00:52:19,509 Speaker 2: to take sides. So you got to be very, very 854 00:52:19,919 --> 00:52:26,120 Speaker 2: vigilant and make sure that nothing comes close to your shores, 855 00:52:26,520 --> 00:52:31,280 Speaker 2: which affects you having to make a choice between uh 856 00:52:31,280 --> 00:52:33,469 Speaker 2: US and China. But of course, at the same time, 857 00:52:33,800 --> 00:52:37,029 Speaker 2: you got to step up your substantive ties with both countries. 858 00:52:37,570 --> 00:52:40,340 Speaker 2: And, and here I must say that the good news 859 00:52:40,340 --> 00:52:43,689 Speaker 2: is that the United States doesn't have a trade deficit 860 00:52:43,689 --> 00:52:46,300 Speaker 2: with Singapore. See that being flagged in the media, it 861 00:52:46,300 --> 00:52:50,580 Speaker 2: has a trade surplus with Singapore. And fortunately for us, 862 00:52:50,800 --> 00:52:54,149 Speaker 2: Donald Trump knows a little bit about Singapore and admire 863 00:52:54,149 --> 00:52:57,658 Speaker 2: Singapore because when somebody asked him, why did you bring 864 00:52:57,659 --> 00:53:00,620 Speaker 2: Kim Jong-un to Singapore to meet him. 865 00:53:01,750 --> 00:53:03,339 Speaker 2: And he's uh. 866 00:53:04,219 --> 00:53:06,580 Speaker 2: His answer was that I wanted Kim Jong-un to see 867 00:53:06,580 --> 00:53:10,020 Speaker 2: a successful country like Singapore so that he could model 868 00:53:10,020 --> 00:53:14,779 Speaker 2: North Korea and Singapore. And, and that frankly, uh, is 869 00:53:14,780 --> 00:53:18,820 Speaker 2: worth something, the fact that Donald Trump respects uh and 870 00:53:18,820 --> 00:53:25,270 Speaker 2: admire Singapore, but in the event of uh something coming up, 871 00:53:25,699 --> 00:53:30,340 Speaker 2: don't count on uh loyalty from Donald Trump. Uh, he 872 00:53:30,340 --> 00:53:32,620 Speaker 2: doesn't know what the word loyalty means at all. 873 00:53:33,250 --> 00:53:38,320 Speaker 1: So, on that very realistic sober note, Kiswa Mahawai, thank 874 00:53:38,320 --> 00:53:40,530 Speaker 1: you so much for your time and insights. My pleasure. 875 00:53:40,719 --> 00:53:43,199 Speaker 1: It's great to have you and thanks to our listeners 876 00:53:43,199 --> 00:53:46,159 Speaker 1: as well. Copy Time was produced by Martin Delrich. 877 00:53:46,709 --> 00:53:50,030 Speaker 1: Uh, ballad Lee and Daisy Sherma provided additional assistance. All 878 00:53:50,030 --> 00:53:54,020 Speaker 1: 147 episodes of the podcast are available on YouTube, also 879 00:53:54,020 --> 00:53:58,500 Speaker 1: on Apple, Google, and Spotify. As for our research publications, webinars, 880 00:53:58,750 --> 00:54:01,389 Speaker 1: and live streams, you can find them all by Googling 881 00:54:01,389 --> 00:54:03,629 Speaker 1: Devious Research Library. Have a great day.