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New possibilities and opportunities
SINGAPORE and China relations have come a long way, celebrating 25 years of diplomatic ties last year. During Chinese President Xi Jinping's visit to Singapore last November, the two governments established an "All Round Cooperative Partnership Progressing with the Times". This partnership will see both countries continue to deepen bilateral relations and take it to a new level, in line with development priorities and interests of both countries.
Singapore's bilateral relations with China are undergirded by strong economic links. Today, China is Singapore's largest trading partner and Singapore is China's largest source of foreign capital since 2013.
Singapore's interest and involvement in the Chinese economy took concrete form in 1992 with the first government-to-government project in Suzhou, followed by the Tianjin Eco-City Project in 2008. Singapore was also a large investor in the bank listings of China Construction Bank in 2005 and in the Bank of China in 2006 when capital markets in China were still nascent.
But as the phrase "All Round Cooperative Partnership Progressing with the Times" suggests, the nature of our economic partnership is changing and that is a function of the economic changes both economies are facing.
FUNDAMENTAL CHANGES AFFECTING BOTH ECONOMIES
With economies world-wide undergoing structural change arising from disruptive technology and business models fundamentally changing the way business is being done, both Singapore and China are having to respond by creating new trajectories of growth.
Singapore has embarked on a remake of the economy with its Research Innovation and Enterprise 2020 spelling out the four areas that Singapore will focus on and develop vertical competencies in: Health and biomedical sciences, advanced manufacturing and engineering, urban solutions and sustainability and services and digital economy. The Committee of the Future Economy was also set up to develop economic strategies to build a vibrant and resilient economy with recommendations to be made by end 2016 on jobs and skills, industries and markets, connectivity, future city and corporate capabilities and innovation.
In China, in the Report on the Work of the Government in 2015, Chinese Premier Li Keqiang proposed the "Internet +" plan to create synergies between the fast growing Internet industry and other traditional industries, providing new growth drivers for the economy. Both the 13th five-year plan and "Made in China 2025" strategies have innovation at their core to deliver quality, balanced growth and openness.
The private sector will play an increasingly important role in both economies. It is a driver of change in the marketplace globally as its search for profit and need to stay ahead of competition necessitates it to constantly re-evaluate business models and test new technologies so as to deliver new products and solutions to consumers while compressing value chains.
A NEW MODEL OF PARTNERSHIP
Singapore's early model of partnership with China could be described as an extension of our developmental state model, where large government-linked companies played a key role in the early government-to-government projects.
With the challenges brought about by the new economy, fast growing knowledge-intensive and innovation-led small and medium enterprises in the private sector may be the new economic dynamo.
In the third government-to-government project launched last year, the Chongqing Connectivity Initiative, the emphasis is not on large-scale fixed-asset investment led by government-linked corporations. Instead, various companies in the private sector are being encouraged to look at opportunities in the areas of finance, aviation, transport and logistics and info-communication technology.
China, for the first time, is also investing abroad more than its inward investment flows. Together with the "One Belt One Road" initiative, there are new opportunities for Singapore and Singaporean business people to seek new partnerships with Chinese companies as they look to expand in our region and the world. Singapore's experience and strengths in finance, corporate governance and project management as well as status as a regional trade and financing hub allows us to play a key role in China's One Belt One Road initiative.
BUSINESS CHINA AND THE FUTURECHINA GLOBAL FORUM
Business China was started in 2007 by Singapore Founding Prime Minister Lee Kuan Yew and under the strong stewardship of chairman Chua Thian Poh for the past nine years, aims to foster a group of young bi-cultural and bilingual Singaporeans who can leverage opportunities in China to create win-win solutions and also act as a bridge for China and the world.
We often talk about economic partnerships and economic growth as if these are powered by faceless institutions. But the drivers behind these initiatives and policies really are individuals who understand the state of development of both countries, where interests interlock and where mutually benefiting opportunities are.
There are many success stories among China's new entrepreneurs who are making waves, not just in China but worldwide with innovative business models and platforms. We are pleased to invite several of them to share their stories with us at FutureChina Global Forum 2016.
There are also already trailblazing Singaporeans who have made a name for themselves in China identifying disruptors in technology and business models and spearheading change in traditional industries. They have invested in and mentored entrepreneurs in China and provided growth capital to fast growing companies. Several of them have made it to the top 100 private equity investor list in China. We hope that more Singaporeans can identify opportunities in China and create value for both economies.
Business China's flagship programme, the FutureChina Global Forum is into its 7th year and this year, is themed "Transformation or Stagnation: What the new economy heralds for China and the region". More than 60 esteemed speakers who are leaders in their industries will share what they see are opportunities and challenges in their fields. From the co-founders of Alibaba to the founder of BYD Co, whose electric vehicles ply the streets of Singapore, we hope their sharing will open new vistas for our audience into the exciting economic frontiers of the new economy.
The evolving new economic landscape provides exciting opportunities for both Singaporean and Chinese businesses alike. Singapore is well-positioned to partner Chinese companies in their regional journey, deepening China's connectivity to the region and more. The next chapter of Singapore-China bilateral relations will truly be rewarding.
- The writer is CEO of Business China