Safe and free flow of goods key to realising potential of China's Belt and Road Initiative: DPM Teo

Safe and free flow of goods key to realising potential of China's Belt and Road Initiative: DPM Teo
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Published: 12:10 PM, July 13, 2017
Updated: 11:09 PM, July 13, 2017

SINGAPORE — The safe and free flow of goods is key to realising the full potential of large investments that have been made to boost connectivity and transport linkages cross four continents under China's Belt and Road Initiative (BRI), said Deputy Prime Minister Teo Chee Hean.

Delivering the opening speech at the FutureChina Global Forum on Thursday (July 13) morning, Mr Teo noted that much attention has been focused on the "headline-grabbing value and scale" of some large infrastructure projects along the Belt and Road.

"However, China appreciates that realising the full potential of BRI involves more dimensions and layers," he said, adding that BRI's overarching concept is about boosting connectivity.

This means going beyond being driven principally and financially by China, to being inclusive, with co-ownership by partners and support from people from countries along the Belt and Road.

It also entails connecting projects, and looking not only at building physical linkages but also digital and human networks.

On the billions of dollars of investments made by China and other countries so far to boost build such links, Mr Teo said: "The full potential of these investments can be realised when they form a network that allows the safe and free flow of goods - overland across Central Asia; and over the seas along the Maritime Silk Road through the South China Sea, the Straits of Malacca and Singapore, and the Indian Ocean."

Elaborating on Singapore's position on the Straits of Malacca and Singapore, he noted that they are key Straits connecting the Pacific and Indian Ocean Basins.

The use of these straits by vessels from all over the world is provided for in international law and cannot be suspended or impeded.

"Singapore is a strong proponent of the right of transit passage for ships and aircraft of all countries through the Straits of Malacca and Singapore. This is a key principle of vital interest to us as trade is our lifeblood," he said, adding that adherence to this principle is also critical for the success of the Maritime Silk Route under BRI.

"Singapore will continue to uphold this right of transit passage for ships and aircraft of all countries, and will not support any attempt to restrict transit passage to ships or aircraft from any country."

Mr Teo cited how in 2006, Singapore had disagreed with Australia's proposal to place certain restrictions on vessels transiting the Torres Straits between Papua New Guinea and Australia, even though the Republic was also a strong advocate of marine environmental protection.

"China too had expressed her disagreement with the Australian proposal at the time. Singapore naval ships and aircraft also work together in the Gulf of Aden, with ships from the navies of China, the US, NATO, Japan, South Korea and other countries, to ensure that the sea lanes there remain safe from piracy," he said.

"Working together to keep the key sea lanes open and safe for shipping from all countries, and for all countries, is a key pre-requisite for the modern Maritime Silk Road."

The BRI is an ambitious Chinese undertaking to expand links between Asia, Africa, Europe and beyond, underpinned by billions of dollars in infrastructure investment. The initiative draws on the ancient overland Silk Road economic belt connecting China to Europe, together with the Maritime Silk Road connecting Asia, the Middle East and Africa.

China has been made significant investments in countries in these regions through the Asian Infrastructure Investment Bank (AIIB), the Silk Road Fund and the New Development Bank. The China Development Bank and Export-Import Bank of China have also extended US$ 110 billion in loans for BRI projects by end 2016.

China has also long been concerned about maritime navigation through the Straits of Malacca, as over three-quarters of its oil and energy imports flow through the narrow and congested waters.

It has been dubbed Beijing's "Malacca Dilemma", after Chinese President Hu Jintao asserted in 2003 that "certain major powers" have tried to control the strait and called for new strategies to tackle the perceived vulnerability.

In his speech, Mr Teo also reiterated Singapore's support of the BRI, adding that the Republic and China have agreed to make it a key focus area for bilateral collaboration, with both sides looking at how to enhance physical and digital connectivity; financial connectivity as well as people-to-people connectivity.

On financial co-operation, he noted that Asia is expected to require US$26 trillion of infrastructure investment from now to 2030 and this creates opportunities to deepen financial linkages between Singapore and China to support new project financing needs and the internationalisation of the renminbi.

The two countries can also collaborate with third countries along the Belt and Road in human capital development, he added.

"The Belt and Road Initiative is a grand vision that has the potential to bring long-lasting benefits for regional development and integration, uplifting the economies and people across this whole vast region," he said.

"Singapore will work with China to help realise this potential."