SINGAPORE — Prime Minister Lee Hsien Loong on Monday (8 August) cautioned that "a storm is gathering" around Singapore amidst geopolitical instability, even as the city-state barrels forward beyond the COVID-19 pandemic.
"Our road ahead will not be easy," he noted in his annual speech. "(The relationship between the US and China) is unlikely to improve anytime soon. Furthermore, miscalculations or mishaps can easily make things much worse."
Lee also pointed out that Russia’s invasion of Ukraine, which began on 24 February, has had profound implications for Singapore.
The war has set Russia, described by Lee as a nuclear power, "bitterly against" many states, especially the US and the NATO countries. "The hostility is deep, and will not be resolved easily," he added.
Particularly vital to Singapore is the fact that the invasion violates fundamental principles of sovereignty and territorial integrity under the United Nations Charter.
These principles underpin Singapore's security, and even its existence, stressed Lee, with the war also further straining China’s relations with the US and the latter's partners in Asia.
"Singapore will be buffeted by intense rivalry and tensions in the region around us," he cautioned, adding that staying united will be key to Singapore’s survival.
"It is the only way to deal with challenges in an increasingly troubled world. We must look to our Total Defence, and maintain a strong and credible SAF (Singapore Armed Forces) and Home Team," Lee said.
"We must also brace ourselves and be psychologically prepared that in the next decades our region may not be as peaceful and stable as it has been thus far."
Cost of living challenges
The Russia-Ukraine invasion has also aggravated economic challenges affected by the COVID-19 pandemic – such as disrupted supply chains and rising inflation around the world.
"I know that the cost of living is at the top of everyone’s minds. The government is doing everything necessary to help Singaporeans cope with rising prices," said Lee.
COVID-19 will not be Singapore’s last crisis. More storms and turbulence lie ahead. But do not fear.PM Lee
These include rolling out multiple support packages, securing supplies of food and other essentials, diversifying Singapore's sources, and building up adequate stockpiles.
Authorities have also tightened Singapore's exchange rate policy and strengthened the Singapore dollar, to dampen imported inflation, Lee said, adding that the government stands ready to do more to help Singaporeans if things worsen.
However, he stressed that due to shifting international economic conditions, the world is unlikely to return anytime soon to the low inflation levels and interest rates that Singapore has enjoyed in recent decades.
"Singapore’s deeper response to this shift must be to transform our industry, upgrade our skills and raise our productivity. Then our wages can go up higher than inflation, and Singaporeans can earn more in real terms year by year," said Lee.
On Singapore's two-and-a-half-year battle with the novel coronavirus, he noted that the city-state is now in a much better position with a highly vaccinated population and a healthcare system that has not been overwhelmed.
"Indeed, COVID-19 has been the test of a generation. We held up through this trial, to emerge stronger and more united. This unity is crucial as we move forward beyond COVID-19," he said.
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