New rules in digital, green and AI economies are key as the World Trade Organization’s core principles erode
[SINGAPORE] There is no going back to the rules-based global economic order of the 1990s, Deputy Prime Minister and Minister for Trade and Industry Gan Kim Yong said on Friday (Sep 19).
Therefore, plurilateral agreements between multiple economies can act as “pathfinders” towards a more inclusive and progressive global economy, he said.
These include the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the Regional Comprehensive Economic Partnership (RCEP), both of which Singapore and several Asean members are part of.
At the 16th FutureChina Global Forum organised by Business China, DPM Gan noted the diminishing influence of the World Trade Organization (WTO) and the erosion of the rules it enshrines.
He said: “The WTO has struggled to negotiate new agreements, its dispute settlement mechanism is paralysed, and its core principles are at risk of being eroded.”
Instead, in line with the theme of the forum, “The World in Flux: Challenges and Opportunities”, the minister emphasised the importance of deeper and more flexible cooperation between multiple economies.
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These plurilateral agreements can pioneer new rules for evolving issues in the current and future economy, he said, including frameworks on digital trade, standards for the green transition and safety in new technologies like artificial intelligence and quantum computing.
Noting that 2025 marks the 35th year of bilateral relations between China and Singapore, DPM Gan said that China’s cumulative investments of S$223 billion in Singapore have made it the Republic’s largest foreign investor since 2013.
Both countries have been beneficiaries of the principles governing open markets that the WTO had advocated, he said, such as non-discrimination, transparency and binding dispute settlements.
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However, interdependent global trade networks and China’s rapid growth are now also the root of rising tensions, highlighted by the present “fragile equilibrium” between the US and China, DPM Gan noted.
“If the equilibrium breaks and if more countries resort to power-based approaches, we risk a world of fragmented supply chains, rising uncertainty and weaker growth,” he said.
In his opening remarks at the forum, Business China chairperson Lee Yi Shyan said that US-China tensions have expanded from areas like technology, finance, trade and supply chains, to academic exchanges and interpersonal interactions.
Even so, Singapore’s economic relations with China must still reflect a rules-based order, albeit one “updated for the realities of our time”, said DPM Gan.
Collaborative investments between Singapore and China in the past have been closely tied to the Asian giant’s developmental priorities, he added.
This legacy will continue, as Singapore’s business relations with China in key areas such as technology, innovation and green development remain critical, he said.
“Business China can help our businesses identify new opportunities in these sectors and facilitate win-win partnerships with Chinese enterprises,” the minister said.
