S’pore a major platform for EU’s economic integration in region

As Singapore celebrates its founding 50 years ago, TODAY is running a monthly series of interviews with the ambassadors of several countries that play a key role in Singapore’s foreign relations. This month, Rumi Hardasmalani (rumih [at] mediacorp.com.sg) speaks to the European Union Ambassador to Singapore, Dr Michael Pulch. In a wide-ranging interview, the envoy speaks about Singapore-EU ties, climate change, the future of the eurozone and the migrant crisis in Europe, among others.

What are the EU’s policy objectives for Singapore and the region?

Singapore for us is a major platform for our economic integration in the region. For every euro we invest in ASEAN (Association of South-east Asian Nations) countries, 60 cents goes to Singapore. It is also one-quarter of our trade in goods and one-third of our trade in services in the ASEAN region. There are about 11,000 European companies registered here.

Our investments here are by far the highest compared with any other partner of Singapore. We use Singapore as our headquarters for economic activities in the region. That was one of the reasons we moved to negotiate a Free Trade Agreement (FTA) with Singapore.

Singapore is also the place where businesses come together. Business Avenues For South-east Asia is our new initiative here through which we plan to bring 1,000 European SMEs (small and medium enterprises) to Singapore and to other ASEAN countries over the next five years. It is an excellent opportunity for SMEs — the backbone of our economy. Very often our companies do not realise how SEA as a market is, and that there are opportunities here. There are some very innovative and top-notch (companies producing) technologies that I am sure will find new partners here.

Singapore benefits in two ways —partnerships with the EU for technology that suits them to enhance their business strategies and new products for consumers.

What is the latest on the Singapore-EU FTA (Free Trade Agreement), and what has been driving it? When do you expect it to be formally approved?

We chose Singapore for a range of reasons. First, we have long established a presence in Singapore. Good governance and business stability have kept us rooted here.

Second, Singapore is a partner experienced in negotiating FTAs. The Singapore-EU FTA is the gold standard and the most advanced FTA we have ever negotiated. We hope that we will achieve similar levels of advanced new provisions in FTAs with other countries.

We have since been able to conclude an FTA with a second ASEAN country, Vietnam, and we know others are interested in finalising negotiations as well.

The Singapore-EU FTA has been approved by the European Commission. However, the agreement has been sent to the European Court of Justice for an advisory opinion on the separation of competences between Member States and the EU. In other similar cases, it took the Court 12 to 18 months to present its opinion. On that basis, the approval process with Member States and the European Parliament will be finalised.

The negotiations for ASEAN-EU FTA were launched in 2007, but were eventually stalled. Does the Singapore-EU FTA pave the way for an ASEAN-EU FTA?

The Singapore-EU FTA will be the stepping stone to a potential future ASEAN-wide FTA to be developed at a later stage. After exploratory negotiations on the proposed EU-ASEAN FTA, we realised that the level of ambitions were different between us and ASEAN, and also within ASEAN. That was the reason we decided to move on to the most advanced economies in the region and Singapore was the first choice for bilateral FTAs.

The idea was to build a platform as well as the momentum for an EU-ASEAN FTA as a longer-term objective. We will now take stock of the situation by the end of this year and move on from there.

The EU has pledged to cut greenhouse gas emissions by 40 per cent by 2030. How was this ambitious target derived? Was it difficult to convince some of the emerging economies such as Poland and Hungary to come on board?

It is not an easy process to bring 28 countries together. First, we defined our objectives and then created measures and divided the responsibility among ourselves to achieve that objective.

We have taken into account the fact that member states use different mixes of energy with some still dependent on natural resources such as coal, so their reduction in coal usage is more difficult to achieve. But our advantage is that we can distribute the cuts across different states, thereby bringing in those that are more sceptical. We are on track to achieve the goal.

Europe has gone through testing times, and the situation at present is also not as bright. How do you see the future of the eurozone?

The euro is here to stay, and we will do what it takes to safeguard it. After the financial crisis, we did not break but evolved from a sovereign debt crisis. The problem was not the euro but the debt situations in member states. We were simply not prepared for such a crisis — we didn’t have the instruments that we should have had, but we have since developed them.

Many member countries have since evolved and turned the corner. Our tough austerity measures have worked.

Greece was left behind as it did not really undertake the structural reforms that were necessary. The new agreement with Greece will put it back on track.

In the end, the one thing that prevailed is the political commitment from everyone to ensure that the EU continues, and that Greece has a future in the eurozone.

How has the EU coped with the refugee crisis? What is being done to help developing EU members cope with the influx?

There is no other issue as important in Europe now than the refugee migration. This is the largest flow of refugees Europe has seen since the Second World War, and all of it in a matter of 12 weeks. Virtually no one could have been prepared for it.

The EU has decided to look at this from a holistic point of view. The top priority is to save lives, and that’s why we set up a new system of navy fleet operations in the Mediterranean to prevent people from drowning.

The second is look at the root causes of migration: Some of it is economic migration, while some are refugees from war zones — like about 60 per cent of refugees who are now fleeing the civil war in Syria. The European citizens have shown heartfelt sympathy, and governments decided these people deserve our protection. But we need to address the issue of migrant smuggling and human trafficking.

There are also different cultures in eastern and western Europe. Eastern Europe, because of its isolation during the Cold War, has not been accustomed to accommodating migrants as some other member states have been for a long time.

Our leaders are looking at increasing support to neighbouring countries that are doing a lot, as that will allow migrants to stay close to home and hopefully return once it is peaceful again.

I believe we will find a solution that will address specific issues of some member states and also the real problems of some of the frontline nations.

The basic issue is how we can secure a proper integration of those who want to stay and those who have a right to stay within the means that we have and under current circumstances.

As Singapore morphs into a smart nation, are there learnings from Singapore you can take back home?

What fascinates me here are innovations in traffic and public transport management. Then there are other things such as rooftop gardens and vertical greenery. These are all clever ideas we could take back home, among many other good initiatives I come across while living in Singapore.