DBS Economics & StrategyKopi Time E147 - Kishore Mahbubani on a Fragmenting World
We welcome back to Kopi Time Kishore Mahbubani, distinguished diplomat, academic, and writer on geopolitics. Our conversation, recorded in Mumbai, kicks off with India’s promise and challenges vis-à-vis the US and China, with the former turning increasingly protectionist and latter facing a myriad of domestic and external challenges. Mahbubani sees no room for emotion in geopolitics, expecting to see India follow its pragmatic instincts to pursue industrialisation with capital and technology from both superpowers. We then discuss Trump 2.0, the future of multilateralism, and Asia’s place in the great power rivalry. Always sharp and insightful.
Welcome to Cookie Time, a podcast series on markets and economies from DBS Group Research. I'm Tebei, chief economist. Welcome you to our 147th episode. Today, we are delighted to have Kishore Mahbani back on the show. He's a distinguished fellow at the Asia Research Institute, National University of Singapore. Mr. Mahobani has been privileged to have two distinct and very distinguished careers. First, as a diplomat from the 70s all the way to the early 2000s, and then in academia.
He is a prolific writer who has spoken in many corners of the world, and his latest book is Living the Asian Century An Undiplomatic Memoir. Highly recommended. Kiswani, welcome back to Coff Time. Thank you, Timur. It's great to have you, and we are recording this in Mumbai, India. So I would like to begin our conversation with India. Where do you see India sitting here in late January 2025 in the geopolitical landscape?
Uh, first of all, thank you very much for having me on again. Uh, I know that our first recording had quite a few
so
far
the history of COVID time,
yes. Um, you know, to understand, uh, India's place in this geopolitical moment.
We have to understand first the geopolitical movement.
And here it's important to emphasize, we are a very unique crossroads.
In the field of geopolitics.
So there are fundamental structural take uh structural changes.
Taking place in the geopolitical order. That's the moment. And the question, therefore, is which countries are adapting well to this, to these structural changes and which countries are adapting badly?
To these structural changes. I can give examples of both. So clearly, one of the changes that is happening, and I've said this over and over and over again, is that we're reaching the end of 200 years of Western domination of world history, you know. So, clearly the 88% of the world's population who live outside the West are waking up significantly and people ask me to give one simple example of this.
I just say, look at the uh Ukraine war, even though the Russian invasion of Ukraine was clearly illegal, no question about that. When the West imposed sanctions on Russia, 85% of the world's population didn't join the West in imposing sanctions on Russia. So you can see, therefore this bifurcation.
And uh at the same time also, within the West, uh, you have to make a huge distinction between United States and Europe. You know, at the beginning of the 21st century, they were more or less on par.
Now, look at the United States is so much bigger, right? The EU has shrunk to 2/3 the size of the United States and the European Union clearly has also lost its way and is floundering in terms of adjusting to this new world order, both in the arena of geopolitics and their mismanagement of the Ukraine issue and also uh in economics and not being able to grow their economies and adapt and just to a new world.
By contrast, by the way, the United States looks very robust and strong and and dynamic. So in this setting, uh, there will be winners and losers with these structural changes, and I predict that India will be a big winner because this, this, this, these kinds of structural changes open windows of opportunity and clearly India is going to have a major window of opportunity because as things change.
As people try to cultivate the rising powers, India clearly is one of the rising powers. The beginning of the 20th century wasn't in the top 10 list of world economies. Uh, today it is already number 5. By 2030, it will be number 3. So India has arrived in that sense. So as we move towards a multipolar world order, India will be one of the significant poles, and India, therefore, can become a huge beneficiary if it plays this game well.
So let's talk about the playing the game well in the context of India-US relationship. We have Donald Trump back in the White House. Um, India runs a large trade deficit. Uh, the US has a big trade deficit vis a vis India. Uh, Trump's key API or key performance indicator seems to be narrowing deficit vis a vis nations. Would he impose tariffs on India? How will India play that? What's your
sense?
Well, I think in the case of Donald Trump.
Uh, you have to do, uh, you have to switch your means of calculating. Uh, you know, in the past, you know, things like goodwill, relationships, uh, um, how do you say, established history would make a difference. In the case of Donald Trump, nothing matters except very simple question, what have you done for me lately? That's all he asks.
And this is where on the one hand, uh, I have no doubt that the close personal relationship between Donald Trump and the Prime Minister Narendra Modi is a genuine, they both get along with each other, will make some kind of a difference. But you know, frankly, if you look at countries in the world, no country has been as loyal to the United States as Canada has been.
And if you look at the way that Canada has been kicked around by Donald Trump, you realize that relationships don't matter.
At the end of the day, what matters is pure uh transactional interests, and he will want to see uh balanced trade between US and India.
Uh, he may insist on India opening up, uh, some of its markets, uh, to American products. He's going to deport illegal Indian immigrants, which is, you know, going to be a problem for India because if you look at the countries with the number of illegal immigrants in the US, number one is Mexico, number 2 is El Salvador, number 3 is India.
So there'll be some friction, you know, in the way it's done and so on and so forth. You saw it with Colombia and all that, that's right. So there are potential issues uh that could complicate uh relations uh with the Donald Trump administration, but the biggest complication arises from the fact that, you know, in the Biden administration which courted India ferociously except except the last year, something went wrong in the last year, clearly.
Uh, saw India as a natural ally against China.
Uh, Trump doesn't see allies as assets.
Trump sees allies as liabilities.
Seriously, so all he's asking you is, how much are you paying me and what have you done for me lately?
And so even uh he's not going to see India necessarily as an important ally, uh counterbalancing uh China, for example. In fact, one of the problems that India may have is that since Donald Trump is a big deal maker, he may come to some kind of deal with China.
And if relations between US and China settle down, then the value of India as a geopolitical card goes down.
And so India, therefore has got to adjust and therefore try to see how we can take advantage of these changes to ensure that its interests are protected.
I want to talk about India-China relationship momentarily, but just want to stick with in the US, uh, briefly before we do that. The US is, or rather Donald Trump's team is keen on getting a deal done between Ukraine and Russia, but the first step in that direction seems to be tightening the screw on Russia and easing the screw, including.
Access to Russian oil, you know, heavy discount that both India and China have been benefiting. So how does India calibrate its still fairly deep relationship with Russia while dealing with the US with this transactional?
Well, I think for India it's a matter of vital national security interests to preserve its relationship with Russia.
Because at the end of the day, you know, when you go through a crisis, we all go through crisis.
You have to ask yourself, who can you rely upon in a crisis. So for example, that if India has a problem that appears in the UN Security Council of the five permanent members, United States, UK, France, China, Russia, the only dependable ally or friend that India has is Russia.
If you, if India asked Russia to veto something on India's behalf, Russia is likely to do so. So you watch even the body language and the meetings between uh Prime Minister Narendra Modi and Putin, President Putin within Prime Minister Narendra Modi and Sergey Lavrov, you can see there's a lot of trust that's been built up over there. So India is not going to give up its relationship with Russia.
And for India as a net importing oil country, to give up access to cheap Russian oil will be a huge economic price to pay, and I don't see how why Indian should pay that economic price. So I think they will definitely resist any moves to um ah have get by the US to try and get them to cut off their ties with Russia.
And you know, going, you since you want to discuss the USIndia relationship. I think it's also important to emphasize why why did things go some a bit rough in the last year, the Biden administration. Things seem to be, you know, going so well.
And then you had at least 3 points of friction that emerged. First was, of course, the, uh, I think India was surprised how Canada went full blast on going after India.
About the purported assassination of a Canadian citizen.
And you know, traditionally, Canada would listen to hints from Washington DC.
Didn't the Biden administration tell Canada, go easy, you know, India is an important friend. That question must be on Indian minds. And then, of course, the sudden removal of Sheikh Hasina from Bangladesh was also a bit of a shock for India, because Sheikh Hasina was a reliable friend of India and right now, as you know, she's in India.
Uh, and that also, frankly, was encouraged uh by the United States that we know it's a matter of fact.
And then thirdly, the other thing that surprised me was the decision of the Justice Department of uh the Biden administration to go after Adani.
I mean, surely enough people in Washington DC knew that, you know, Mr. Adani is very close to Prime Minister Modi. So suddenly you find a relationship that you thought was a good one.
Uh, got a lot of sand was thrown into the gearbox. And so that's why I think India has got to really decide, uh, how it balances, it's still, it's still going to have good relations with the US, by the way, there's no question whatsoever, but how you balance the, how you play the balance within US and China. You got to recalibrate now.
Speaking
of recalibration, let's talk about India and China relationship.
Yeah, well, I think in the case of the India-China relationship, clearly some degree of rethinking is going on. I mean, I, I was surprised to learn from you this morning.
That India has allowed the resumption of direct flights between India and China. That was a major anomaly. I mean, a major anomaly. I mean, the two biggest.
Uh, uh, I mean, apart from Japan, the two biggest economies in Asia have no direct flights to each other. That doesn't make sense, you know. So clearly there was a big move and it's part of a gradual recalibration driven partly by the fact you by realization you can't put all your eggs in the American basket. You can't just rely on the
Uh, United States and at the same time, uh, if India's goal is to become a manufacturing economy, no country in the world, anywhere, by the way, including United States, Germany, uh, UK can advance their manufacturing agenda without in one way or another getting inputs from China. I mean, the most stunning statistic of the 21st century.
Is that when the 21st century opened in the year 2000.
Uh, China's share of global manufacturing was 5%.
Uh, by 2030, it will be 45%. Now that's stunning. Now, virtually every product in the world that is manufactured, I think, in one way or another contains some kind of Chinese uh component because that's how indispensable the Chinese manufacturing economy has begun. And if you, if you closed your eyes, OK, you, you, you scrub out the word India, put economy X.
And you scrub out the word China, you put economy Y.
And you did a simple cost-benefit calculation. Would economy X benefit from closer cooperation in manufacturing economy Y or would it be would it be better off doing less with economy Y? And any kind of basic cost-benefit calculation will show you that India will benefit a lot more by not necessarily cooperating.
But taking advantage of China's manufacturing capabilities to enhance its own manufacturing uh in India. And so to give a simple and obvious example, India wants to become a big manufacturer of iPhones. There is no way you can manufacture an iPhone without Chinese components. No way, absolutely no way. And I can tell you that Apple's reliance.
Everybody thinks that because of the US China friction.
Apple has reduced its reliance on Chinese components. If you studied carefully, it has actually increased.
Because the, the products in China have become cheaper and more competitive, and Apple is all about profits. So clearly, you, you, if you really want to enhance your manufacturing capability, and I think as you know, some people within the Prime Minister Modi's government are coming to realize that they have to in one way or another collaborate with China too.
It is encouraging, uh, absolutely. Uh, you mentioned Apple. My understanding is that when Foxconn was initially nudged into assembling iPhones in India, the fear, even among Indians was that, you know, it may not match the efficiency of Chinese manufacturing plants. But now we can see that there's a win-win there. You be part of the Chinese supply chain, bring in the inputs, bring in Indian labor, train them, and now my understanding is that the Apple's yield in India is almost as good as it is in China. Uh, so.
There is a mutually beneficial dynamic there in place. Foxconn is happy, India is happy, Chinese components remain in place, uh, but
it has increased India's trade deficit with China.
It will probably do the same, yes, indeed. Um, so that's the irony that India's fear about Chinese trade deficit probably got in the way of India joining regional companies of economic partnership with.
Uh, now, again, there's some rethink that maybe that was an opportunity lost. You can't just fixate on a bilateral deficit. You have to sort of think about your own export prowess and how you build it with cooperation, joint ventures, if you will, with others. Like you sure I see, for example, uh, MG cars on the roads of India. It's a joint venture between an Indian company and Chinese SAIC.
So that's the Chinese model in the past worked very well for China, and I think India with this recalibration is beginning to head in that direction. I think that's a welcome development. Yeah,
but I'm glad you mentioned RCEP because I think all the, again, objective econometric studies show that if India joins the RCEP, you'll be a net beneficiary.
And India's GNP will gain a boost. I mean, there was already a very powerful geopolitical argument uh for India to join the RCEP because, you know, if India stays out of RCEP, it will lose its ability to integrate better with the ASEAN region. And you know, Southeast Asia, uh, for only for 2000 years.
Has been trying to balance China and India, right? And overall, Indian influence in Southeast Asia has always been very strong because out of the 10 countries in Southeast Asia, 9 have an indic base. Only 1 Vietnam has a scenic base. So there's a natural affinity, natural, how do you say, complementarity between Southeast Asia and India.
But what RCEP does is in with India not joining is that India cuts itself off from Southeast Asia. There's a manufacturing ecosystem there, very powerful one. And in Southeast Asia, of course, by then, uh, by default gets closer uh to China. So there's real political argument for India to join RCP, but more importantly, you know, in the long run, uh, India is going to make a vital strategic decision.
And this is a big strategic decision that only someone as strong as Prime Minister Narendra Modi can make that do you, in the long run, will the Indian economy succeed by being more protectionist or being by being more open? And frankly, the main reason why China has succeeded as an economy so well is that the Chinese made a big strategic decision that the only reason why they suffered.
The century of humiliation from 1842 to 1949, and the reason why they became so weak is because they closed their economy and not integrated with the rest of the world. And as you know, the Chinese have decided, OK, now we'll do the opposite. As Xi Jinping said in Davos in 2017, we'll be plunge into the ocean of globalization, we struggle to swim, we drank water, but we became stronger as a result.
And so now Chinese economy by integrating it with the rest of the world, has become a remarkably robust and strong economy, you know.
And I think India can do the same because India, Indians are naturally competitive. I mean, you look at every country in the world, the Indians have migrated to, and I can say this with some confidence as aindi. I have first cousins, you know, children of my mother's and father's siblings all over the world living in Guyana, uh, Suriname, Texas, London, Florida.
Uh, Nigeria, Ghana, Mumbai, Kolkata, Singapore, Hong Kong, Japan, every corner of the world. I have first cousins and Kyoto, yeah, and you know what, they, they're all doing very well.
They they compete very well, uh, in, in, in, in a competitive uh economic uh environment. You can see in the United States, which is the most competitive human laboratory in the world, uh, the ethnic community with the highest per capita income are the Indians.
So, you know, India, therefore needs to make a very powerful strategic decision that India can and will compete. Now, of course, when you open up the economy, there will be disruptions, there will be difficulties, you know, it's it's, it's the same thing that happens when a woman gives birth, right? You, you go through labor pains. After the labor pains, you end up with a beautiful uh baby.
So and and that beautiful baby could be a much more dynamic competitive Indian economy.
Sure, uh, we are two Singaporeans sitting here in India. So let's talk a little bit about Singapore-India relationship.
Sure. Well, I think we are, we are very blessed.
Uh, that early on, uh, all the leaders of, uh, Singapore decided that they had to make long-term investments in India. And, you know, it, it happened under Mr. Lee Kuan Yew. I actually personally accompanied Mr. Lee Kuan Yew, uh, when he visited India, and I, all I remember is that at that time, I think the Prime Minister was Murai Jayai.
And, uh, Indira Gandhi was in opposition, so you can more or less figure out what year it was. So it regularly, Prime Minister Lee Kuan Yeww used to come here, come here, but the man who triggered what you call the India fever, uh, in Singapore was Prime Minister Goh Chok Tong. And you, you mentioned my, uh, memoirs, Living the Asian Century. I think I also talk about how Prime Minister Goh Chok Tong.
Uh, you know, worked hard to get India admitted into the ASEAN Regional Forum, you know. So over the years, a lot of trust has been built up between the Indian leaders and, and Singapore. So I think that, uh, that long term trust means that we have a very stable, uh, long term relationship.
Uh, between India and Singapore. But at the same time, I think it's important for Singapore to realize.
That the competition for attention of India is growing more intense because all you have to do is do a count of all the leaders coming to Delhi now to court India. It's, it's gone up like this, right? Clearly, India's influence is grown. So you cannot take for granted that just because we were close relation, have close relations in the past, we have close relations in the future, we have to reinvent ourselves.
And continue to work hard to get closer because you can see already in the past, uh, relations between Indonesia and India were not close, but just a few days ago, uh, President Prabowo was invited as the chief guest, uh, of the Indian government. So that, that's an example of how the competition for India's attention.
Will grow in the coming years.
this is a very critical point. Uh, last year, uh, several members of Indian Chamber of Commerce were in Singapore, and they seem to suggest, I mean, there was a push back to what they said, but they seem to think that Singapore lacks a credible, coherent strategy, vis a vis India, especially with all these um competition for attention, if you will. Um, so what should be Singapore's strategy in this time when India is being quartered by the whole world?
Well, I think the important thing is to continue working in the relationship, and I'm very glad that uh President Thaman Shamugratnam came on a state visit to India. I think, uh, probably, uh, apart from the two former prime ministers, uh, Mr. Goh Chok Tong and Mr. Lee Hsien Loong, uh, I think the the third most respected Singaporean figure in, uh, India is Thaman Chamratnam.
There's a lot of uh reverence for him and trust in him. So it's good that he came and re-established.
The close relations, but we also have to keep on sending uh visitors and also working hard to find concrete areas of uh cooperation and collaboration between India and Singapore. And I hope that we can at least work with India slowly to try and persuade India to reconsider your decision not to join the RCEP.
Because I think once India joins the RCP and benefits from joining RCEP, uh, then the ties, uh, not just within India and Singapore, but India and Southeast Asia will become much stronger.
Yeah, I fully concur. Um, let's, uh, put India aside for the time being and talk about what you and I discussed at length in the previous podcast, the China-US relationship.
How do things look from Beijing's perspective, including the last 4 years of Biden administration and the coming 4 years of Trump administration here again,
it's very important to make a distinction between the structural changes and the short term developments.
Excuse me.
Um,
Structurally, the relationship between US and China.
is shifting
I mean, the.
Americans are obviously trying to stop China's development.
They think to some extent they have done so.
But if you take a 10 year time horizon, no way, they're going to stop China.
So the Chinese still feel confident.
That the long run, the long run, they are, they'll be better off. The Chinese economy, as you know, is having some real short term challenges. The next 2 to 3 years will be difficult. The real estate market is still in the dumps.
Uh, consumer sentiment is down.
Business sentiment is down, so they're struggling to get their 5% growth rate. So over the next 2 to 3 years, Chinese economy is going to be struggling. But if you look at China decade by decade.
At the end of each decade, they look so much stronger and I, and I, I gave the statistic how their share of global manufacturing has gone from 5% in 2000 and will reach 45% in 2030. That's an example of how this look decade by decade and and certainly if you look at, you ask yourself a very simple question.
Which leading economy in the world?
Has invested the most in the industries of the future.
I mean, no question is China, EVs, solar panels, wind turbines, battery technology, robots, you go on, right?
And uh if there's one economy that's really prepared for the future, preparing itself for the future, is China, and it's causing structural changes around the world. I mean, if you and I had had this interview 10 years ago, and I told you.
10 years ago, I told in 2015.
10 years from now, Mercedes Benz, BMW, Audi, uh, Toyota, Nissan, oh, we so scared of Chinese automobiles. You would have laughed at me. Everybody would have laughed. You must be joking. I remember as recently as 34 years ago, Elon Musk said, who the hell is going to buy a Chinese automobile?
Look where we are today. All the companies I mentioned are shit scared.
Of Chinese automobiles. So, you know, this is and, and just to mention an event that happened last few days.
Look at how much value Nasdaq has lost.
Because of a company I never heard of called Deep. Where did this Chinese company come from?
And how does a hedge fund manager create a world beating AI company? It doesn't make sense. So, you know, therefore,
What, what we have, the biggest lesson, and this is what I, you know, I, I'm a friend of the United States. My goal is to help the United States adapt intelligently to the rise of the Chinese. And I always keep telling my American friends, it's, it's very dangerous for you to underestimate China. It's safer for you to overestimate China and to be fair to me, I've been saying this for 2030 years, consistently.
And so if the structural changes happening, the rebalancing between US and China will continue. Now over the short term, uh, I think China is probably going to have a rough time initially, uh, with Donald Trump because Donald Trump is, you know, only believes in working through threats and uh tariffs and so on and so forth. So there'll be some rockiness in the US China relationship, but at the same time,
If there's one man who can make a deal with China, comprehensive deal with China, it is certainly Donald Trump. You know, you know, Joe Biden and his administration were so frightened of being seen to be soft on China, they didn't dare to do even the obvious things they could have done to improve ties with China. Donald
Trump has got the advantage. They say only, you know, they say only Richard Nixon could go to China, only Donald Trump can make a deal with China. And at some point in time, if they reach a deal of some kind and stabilize the US-China relationship, that wouldn't be surprised either. So, and this means that all the other people around the world, like the Europeans.
Who are counting on an adversarial US China relationship will suddenly find themselves marginalized.
So this is the sort of thing that you got to be very geopolitics is a very cruel business. You got to think very hard about how you could, on the one hand, enhance your position, and on the other hand, how your position could be seriously suffer if other changes happen.
Like sure, the mercurial nature of Trump is really something else. To your point of the Biden administration being petrified of being seen soft on China, they basically co-opted all the measures that Trump had put in place, and they intensified them, including the ban on TikTok, and then Trump comes back and he says, yeah, maybe we shouldn't ban it. Um, so what was the point of trying to look even holier than thou for the Biden administration, it didn't really amount to anything.
Um, but just saying it,
just a quick point, the bigger problem with the Biden administration.
Is that they didn't have long term strategic thinkers in the administration. I can tell you that in my last, uh, one on one conversation, uh, with Henry Kissinger in October 2022, about a year before he died, he more or less, uh, suggested that, you know, they're not thinking long term and competing with China, you got to ask yourself where you want to be 10 years, 20 years from now, forget the next quarter.
Forget the tariffs and all that. Where, what is your end goal? And the Biden administration never specified what his end goal is going to be 10 years, 20 years down the road. And, and, and what it shocked me even more is that not a single member of the Biden administration.
Consulted Henry Kissinger.
And the least they could have done, at least I mean to show some courage.
It allowed Henry Kissinger to go back to China in 2021 to mark the 50th anniversary of the opening up with China, but they were so scared, they didn't even allow Kissinger to go to China. So that's an example of cowardice that unfortunately plagued the Biden administration.
Yeah, I've I've looked at various speeches that Jake Sullivan and Anthony Blinken gave over the last 4 years.
And I felt that it was a continuation of whatever they thought the Trump administration had done that we're going to be even tougher than that of wide yard and high fence and those sort of analogy. It was all about looking at China as an existential adversary, as opposed to looking at the gains from a win-win relationship of openness.
And and the Biden administration especially.
Because it genuinely, the biggest compliment I can pay the Biden administration is that they understood that climate change was a real threat and it is a real threat, come on. Like climate change is a real threat and you really want to focus on saving planet Earth.
Then you've got to press the pause button on the geopolitical contest with China and tell China, hey, they are both two cabins on one boat, the boat is sinking, let's work together. But the Biden administration, even though it realized that climate change is real, didn't have the courage to tell the American people, hey, we really got to save the planet, and the only way we can save the planet if all of us come together, and we must bring China on board.
That's a very simple, obvious thing the Biden administration could have said, but all they wanted to show is that they were tougher on China than the Trump administration, and it was a losing game, I
agree. Um, let's go back to the point you made about Xi Jinping's speech about China, you know, jumping into the rough waters of globalization and coming out stronger.
If we assume that the narrative of fragmentation continues in the US and Europe, they see China as an adversary and they restrict market access, technology access, and so on. What is China's strategy vis a vis the other 85% of the world?
Well, I think that China's strategy vis a vis the other 85% of the world started more than 10 years ago.
I mean, with things like the Belt and Road Initiative, the Asian Infrastructure Investment Bank, the New Development Bank, you know, and you know, uh, a Brazilian diplomat told me that in the year 2000, it took Brazil one year.
To export $1 billion to China.
Today it take Brazil 60 to 70 hours to export $1 billion to China. So, you know, remember, Brazil is in theory in the American sphere of influence, and Brazil is covered by the Monroe Doctrine and so on and so forth. So here is a country that has developed extensive ties with China. It's not going to sacrifice, uh, it ties with China just because of uh the United States.
So, what what the Chinese have done, therefore vis a vis the 85%, is to enhance their substantive ties with these countries. And another give you another example, Indonesia, you know, when after Indonesia made a decision.
To, uh, build a fast train with China between Jakarta and Bandung, the Biden administration sent a team and said, you know, be careful, be careful. And the Indonesian response was, OK, why don't you, America, come and build a fast train in Indonesia. You'll be happy if you did so. But you know, again, the US couldn't compete with China on that. So, I, I think therefore, the Chinese have, in the Chinese have had
As I, as I explained in my book as China One, a consistent long term strategy on how to manage pressures from China, from United States and China, and the best way to do so is to ensure that the rest of the world uh has a vested interest in not cutting off China. That's a strategic decision they made ages ago, when you see this in ASEAN.
Uh, for example, in the year 2000, China ASEAN trade was only $40 billion US dollars. In 2022, it hit $975 billion you know, almost $1 trillion. So all this interdependency between China and the rest of the world means that they have preemptively, China has preemptively killed any containment strategy.
Uh, by the United States and see, by contrast, the United States doesn't have a long term policy that can counterbalance, uh, uh, China, and actually what the United States has now with the Trump administration is the exact opposite.
Because Trump is actually in one way or another, going to alienate a lot of countries in the world. I'm sure Canada is mad as hell. I'm sure Mexico is mad as hell. Colombia, I'm sure is not mad as hell, even though it.
In the end, you know, when people have to cut out, they get mad, of course. Uh, so, uh, you ironically, if Trump goes systematically threatening country by country systematically, including friends like Japan and South Korea, then frankly, the Trump could be a real gift to China that keeps on giving.
But in terms of China, so nobody contest the fact that, you know, China has deepened economic symbalances with vast parts of the global South, but is it doing the prudent thing in South China Sea, for example, we see Philippines, China friction, sometimes Vietnam, China friction, and of course we have the Taiwan, Korea, Japan uh situation uh vis a vis China as well.
So what's your assessment of China's sort of the wool for your past or is it sort of being a little more pragmatic and dealing with his immediate neighbors?
Well, I mean, uh, the key point I always emphasize about when you deal with great power, great powers, always remember that the phrase benevolent great power is an oxymoron.
No great power is is is benevolent. I mean, the United States was in some ways benevolent after World War 2 and so on and so forth with the Marshall Plan and all that. But as you can see, in the long run, every great power will put its interests first and sacrifice others. As you know, the Europeans are terrified.
Uh, are being abandoned in Ukraine now. Uh, so in the same way, China is also not a benevolent great power. It has to put its own, uh, interests first. And there's no question that as China becomes more and more powerful, uh, it is going to become more and more assertive. I mean, you know, if I give a simple analogy, if you and I having this conversation for an hour, we started off by having a cat in the room, sitting in the corner.
You and I will be talking very comfortably. What a lovely cat, you know, you can look at it. But after an hour, suddenly the cat becomes a tiger. I think you and I would sit here very uncomfortably looking at the tiger, you know. So China, to put it simply, I mean, mathematically, this is true, has gone from being a cat to becoming a tiger, right? Look at how much the economy has exploded. And so you can no longer assume.
That the china that behave like a cat.
It's going to continue behaving like a cat when it becomes a tiger. That's so unrealistic. It's going to become more assertive. But at the same time, there's a huge difference between two English words. One is assertive and the other is aggressive. So China can become more assertive without necessarily becoming aggressive. Now, you mentioned the South China Sea.
Just go and read uh Graham Allison's book Destined for War on US-China relations, where he says Americans keep wishing, why can't China be like us? He said Americans should stop wishing that China be like us because China today.
In the 2020s is where the United States was in the 1890s and the president then, by the way, was McKinley, whom Trump reveres. What did he do? Once you got the muscles.
You declare war in Spain. You seize Philippines, you seize uh Puerto Rico, you, you seize Guam, you, you, you, you, you seize Cuba and so on and so forth. I mean, that's what great powers do. Now, I can tell you this, there are lots of features in the South China Sea.
If tomorrow China decided that it should occupy all of them, it could do so in 24 hours. Everyone knows that, no question whatsoever.
And the question therefore is why hasn't China done that on the South China Sea?
And the here.
When you look, look at all the discussions on the South China Sea, in theory, the problems are within China and the four ASEAN countries, Philippines, Malaysia, Vietnam, and Brunei.
All the discussion of South China Sea in the Anglo-Saxon media.
The South China Sea, the ASEAN countries are keeping very quiet because they know they have to in some ways or another get along and work with China and find adjustments with them. And it doesn't mean that they kowtow to China, but they also know that you got to stand up with China, which Vietnam is doing all the time, but you don't have to do so publicly, right? And the problem with the Philippines is that you notice that when you deal with the rising power as a neighbor.
The most important thing every country in Southeast Asia should have is a consistent long term policy in managing your big neighbor. When you vaccinate, you create confusion and, and, and uncertainty, and the Philippines has gone from uh Maloria Macapagal Arrayo pro-China to Akino pro US to Duterte, pro-China, to now Marcos, pro-S. Now that inconsistency.
Uh, becomes a challenge in, in geopolitics. You know, you're creating, you're creating unnecessary problems. So my, I, I've told my Filipino friends, sit down.
And work out a consistent long-term policy on China where you defend your interest, but make it bipartisan and stick to it over the long term. And don't flip and switch every 4 to 5 years because it's not healthy. At the end of the day, Philippines has got to find a way of living with your big neighbor. and and and the rule of history is that if you have a big neighbor, uh, you adjust to the big neighbor.
And the big neighbor doesn't adjust to you. By the way, in, in just to, just for, just to confirm this, a good friend of mine was a champion sailor.
And she says when you're, when you're on a sailboat.
And you see a big boat, right?
Even if in theory you have the right of way and the big boat has to give way, there's something called the big boat rules. The big boat rules, you, you move aside, because if you ram into the big boat, the big boat carries on and your yacht is sunk. Yes, so, you know, so it's a reality of life and, and, and to pretend that you, you can deal with the power that is so much more powerful.
Uh, as an equal, it's a very dangerous geopolitical illusion. But it doesn't mean, I want to emphasize, it doesn't mean you cut out, give way, and so on and so forth, but you manage the great power in such an intelligent way. You persuade them that it's in their interest to work with you and you're not hostile to them, and yet at the same time you tell them very clearly, these are my core interests and please don't touch them.
I experienced the rule of big boats recently I was canoeing from Palau went back to Singapore. When the big tugboats come, it doesn't matter whether you have the right of way, you get out of their way because they cannot stop for you. But sure, I want to stay with the tiger analogy for a second. US has been a big tiger in the global neighborhood for a century or so, um, and the US soft power has been so powerful in keeping the rest of the world at ease with the US. The recent experience notwithstanding Hollywood.
Books, US companies and their brands. So isn't it in China's interest to project soft power in a more benign way, so that even if the benevolent superpower oxymoron is true, there's a little more adaptability and a little more uh positivity associated with dealing with China.
Well, I think uh there's no question that the US has a lot of soft power.
I mean, uh, if you ask the brightest young people in any corner of the world.
In Latin America, in Africa, in South Asia, in Southeast Asia.
Uh, even in East Asia, you know, if you're bright, young, ambitious, which country do you want to go to and where can you make this become enormously successful?
You can't do that in China. I mean, Brazilian, Nigerian, Indonesian, very rarely can succeed in in China, but you can succeed in uh United States and exhibit A, people like Elon Musk, Satya Nadella, Sundar Pichai, and so on and so forth. So in that sense, the United States has real soft power in terms of attracting the brightest and the best to come to the United States.
But you got to make soft power is going to be dissected, OK?
In the past, the United States had a lot of soft power with the mass populations and also with the governments of the world. Most governments of the world in one way, especially during the Cold War, and I can say this because I worked very, very closely with American diplomats, with American diplomats in the Cold War. Government to government relations were also very close. You could trust the United States.
And the United States will always try to listen to you and deal with you and understand your concerns and all that. Uh, and you know, the height of that I saw when Mr. Lee Kuan Yew went to United States in 1985 and gave a speech at the joint session of the US Congress saying thank you, United States for creating a rules-based order whereby you guarantee us that small states can grow and thrive and do well, right?
So you, they have soft powered individuals and soft power with governments. Now I would say the soft power with individuals still remains. Uh, people still believe, still dream of going to the United States to live and work in. But I would say the soft power with governments is at an all-time low.
Because especially, and this is where Donald Trump is going to do the biggest amount of damage, because Donald Trump's message to every country is, I don't care what you've done for me in the past. That's irrelevant to me. What have you done for me lately?
And also in a more fundamental way, the rules that Mr. Lee Kuan Yeww praised the United States for creating, one of the rules is you respect the territorial integrity of sovereign states. Trump is overthrowing. He's telling Panama, your canal belongs to me. He's telling Denmark, Greenland belongs to me.
Now, I can tell you that every government around the world is asking.
What happens if Trump comes and says, I want a slice of this from you?
How are you going to
Uh, tell him no, right?
And, and, you know, he's doing this to, not to erstwhile adversaries.
Uh, of the United States. I mean, if he was doing this to North Korea or Iran, uh, you can understand this. He's doing, I mean, I can't think of two countries.
That reveal the United States as much as the Canadian and Danish governments that would have been the two governments that would have revealed the United States. Now, United States.
Basically he's saying, excuse me.
You've been to my will, right? And just imagine if China did the same thing with the Philippines, there will be this huge uproar in the Anglo-Saxon media.
But the US is doing it.
So, finally, Yushu, um maybe we move away from China um and come back to our little island of Singapore. Um, Singapore's role in this world where China US relationships sometimes evolve, sometimes deal making, but it is a challenging one. Singapore wants to be open to everyone and uh it is conceivable, not guaranteed, but conceivable that at some point Donald Trump makes it difficult for Singapore to keep its open relationship with China and others.
Um, what is Singapore's strategy in situations like this?
Well, I think the Singapore's strength, uh, is that is the exact opposite of the Philippines. It's very consistent over the long term.
Doesn't switch. So Prime Minister after Prime Minister after prime minister has said, we want to be good friends with the United States and we want to be good friends with China. But it wasn't a problem when the United States and China were getting along, but the first leader in the world to come out openly to say that we will not take sides.
In the in between United States and China was the then Prime Minister, uh, Mr. Lee Hsien Loong, who said at the Shangri-La Dialogue and who followed up with an article in the magazine Foreign Affairs saying Singapore will be friends with the US and Singapore be friends with China. But at the same time, you see, Singaporeans are realistic enough to know that it will not be easy, that things will get more difficult.
Uh, especially with, uh, you know, a leader like Donald Trump who doesn't care what you, what you did for him many years ago. So I would say, therefore, that Singapore has to be very, very careful.
Uh, and make sure that no event happens that triggers, you know, uh, uh, a situation where you're, uh, forced to take sides. So you got to be very, very vigilant and make sure that nothing comes close to your shores, which affects you having to make a choice between uh US and China. But of course, at the same time, you got to step up your substantive ties with both countries.
And, and here I must say that the good news is that the United States doesn't have a trade deficit with Singapore. See that being flagged in the media, it has a trade surplus with Singapore. And fortunately for us, Donald Trump knows a little bit about Singapore and admire Singapore because when somebody asked him, why did you bring Kim Jong-un to Singapore to meet him.
And he's uh.
His answer was that I wanted Kim Jong-un to see a successful country like Singapore so that he could model North Korea and Singapore. And, and that frankly, uh, is worth something, the fact that Donald Trump respects uh and admire Singapore, but in the event of uh something coming up, don't count on uh loyalty from Donald Trump. Uh, he doesn't know what the word loyalty means at all.
So, on that very realistic sober note, Kiswa Mahawai, thank you so much for your time and insights. My pleasure. It's great to have you and thanks to our listeners as well. Copy Time was produced by Martin Delrich.
Uh, ballad Lee and Daisy Sherma provided additional assistance. All 147 episodes of the podcast are available on YouTube, also on Apple, Google, and Spotify. As for our research publications, webinars, and live streams, you can find them all by Googling Devious Research Library. Have a great day.
