Hon. Mr John Lee,
Chief Executive of the Hong Kong Special Administrative Region
Ms. Tammy Tam,
Editor-in-Chief of the South China Morning Post
Ladies and gentlemen
1 Thank you for inviting me to the inaugural South China Morning Post Hong Kong-ASEAN Summit.
2 This event marks a significant milestone as one of the first international summits after Hong Kong lifted its quarantine requirements for travellers in September 2022. It coincides with other major events like the Hong Kong FinTech week and the Rugby Sevens. If not for scheduling constraints, I would love to be in Hong Kong now, speaking to you in person.
3 I am very glad that Hong Kong has made this move. It is never easy, having developed that sense of security with tight pandemic social restrictions and border controls. Yet in our hearts we know that such stringent measures are not sustainable, especially for international cities such as Singapore and Hong Kong. There needs to be resumption of travel for our economies to be viable, to be vibrant again.
4 With hybrid resilience built up through vaccinations and safe recovery from the virus – and the two must go together – we can progressively open up our society and economy. Since Hong Kong’s latest move to open up, I see that the pandemic situation has remained relatively stable in the city. But make no mistake, we must expect new waves and variants of COVID-19 to emerge every now and then, and we must learn to deal with them while allowing life to carry on as normally as possible.
5 I wish Hong Kong all the best in this journey. We are in this together and will have much to learn from each other.
A Symbiotic Relationship
6 Many comparisons have been made between Singapore and Hong Kong. The popular narrative is to paint us as zero-sum competitor. But I think this is a narrow and inaccurate view. Rather, I think there is mutual symbiosis in the Singapore-Hong Kong relationship.
7 Say in the savannahs of Africa, different herds – zebras, gazelles, and wildebeests –graze and migrate together. At first glance, they are competing for the same food source, the grass, which is not untrue.
8 However, they also consume different types and different parts of the grass. Together, their grazing helps to keep the plains clear, so they can both more easily spot predators.
9 Moreover, each animal has different and complementary strengths. Zebras have great eyesight. Wildebeests have a good sense of hearing. By working together, they can better detect danger and improve the group’s collective safety.
10 This is part of the wonders of nature and the complex ecosystem. We need to understand its intricacies and interdependences in order to fully comprehend the relations between herds and species. The ecosystem of the globalised economy is not very different. Supply chains, production capabilities and markets, and people relations – they are all closely intertwined across the world and between cities.
11 The Singapore-Hong Kong relations need to be seen in that perspective. Our companies and sectors indeed compete, but to an even greater extent, they mutually benefit from each other – strategically and in the long term.
Kindred Spirit in Crisis
12 Pre-COVID-19, Hong Kong was Singapore’s fifth largest trading partner and seventh largest investment destination, while Singapore was Hong Kong’s fifth largest trading partner. Singapore companies have business interests in multiple sectors in Hong Kong, including property, financial services, education, healthcare and F&B.
13 As of October 2021, Singapore companies have set up around 450 regional headquarters and regional and local offices in Hong Kong. Similarly, many Hong Kong based companies operate out of Singapore, also across varied sectors.
14 But the mutually symbiotic aspect of our relationship was best exemplified at the height of the COVID-19 crisis, when border restrictions were imposed all around the world, and travel came to a standstill. Changi Airport and HKIA, became ghost towns. It was a very severe situation. COVID-19 struck at the heart of our economic survival, and our identity as vibrant international cities.
15 We had to work together to keep hope alive and revive our cities. Through our combined efforts, we kept our ports running and sustained trade inputs. As a result, total merchandise trade between Singapore and Hong Kong actually grew by over 24% year-on-year in 2021.
16 However, encouraging people-to-people exchanges is very challenging because it is people who carry the virus. We opened up green lanes for business travel, but with a lengthy period of isolated quarantine upon arrival or repeated testing, the take up was low.
17 Former Hong Kong Secretary for Commerce and Economic Development, Mr Edward Yau, and I had many discussions and we decided to take a leap of faith and pioneer the Singapore-Hong Kong Air Travel Bubble (ATB) at a time when uncertainty was still high. We discussed with our colleagues from the health ministries, who supported our proposal.
18 Were we sure that the ATB would be a success? Absolutely not. The odds were against us. But in the midst of a pandemic crisis, both cities instinctively came to the conclusion that we need to try and fight the virus, and open up safe passages to the outside world. Unfortunately, despite all the anticipation, the peaks and lulls of COVID-19 infection trajectories in Singapore and Hong Kong could not coincide. When we are up, you are down, and you are up, we are down, and ultimately, we were unable to launch the ATB.
19 Although the ATB did not succeed, there was no regret. The viability of our economies was at stake and we must put up a good fight. If we can turn back the clock, I think we will do this all over again. During the crisis, Singapore and Hong Kong realised that we are fundamentally kindred spirits and bulwarks of the globalised economy and the international financial system.
Strengthening the Relationship
20 As the COVID-19 situation stabilises, we must now ask ourselves how we can continue to strengthen our mutually symbiotic relationship.
21 To do so, we should first recognise our commonalities. These are essentially a lack of natural resources. Second, we made it up by our endowment of geography that enabled us to become a node of regional and global dynamism. And third, most importantly, Singaporeans and Hong Kongers are both determined to work hard and make the best use of our natural assets, which is our locations.
22 Beyond that, each city has its own distinct advantages and regional conditions. Hong Kong is the most open and cosmopolitan business hub in this region and serves as a key gateway into the Greater Bay Area and Mainland China. Under ‘one country, two systems’, Hong Kong is able to tap on the massive hinterland in Mainland China, while maintaining flexibility and autonomy to strengthen its competitiveness and attractiveness to the world.
23 Meanwhile, Singapore is situated on key sea lanes straddling across Europe, Middle East, South Asia and Northeast Asia, as well as the regional network in Southeast Asia. Southeast Asia is our immediate hinterland. It has a large and diverse population of 660 million people and a growing middle class. Singapore is culturally attuned to and enjoys strong economic ties with ASEAN Member States, which allows us to serve as a key business hub for the region and beyond.
24 Our differing geographies and advantages provide the opportunity and space for our cities to work closely together to bring China and ASEAN markets even closer. The two markets have always been historically close, but in a complex global economy, there is more to be explored and realised.
Suggestions to Strengthen Partnership
25 I am not serving an economic minister, as I look after the health ministry. But here are some of my observations and suggestions.
26 First, we should fully re-establish the linkages between our trading, financial, aviation and shipping hubs to restore pre-COVID-19 trade and people flows. Hong Kong’s relaxation of quarantine requirements for travellers is a welcome step in this direction.
27 Second, we can continue to champion free trade and investment flows within our regions. The Greater Bay Area is at the frontier of China’s reforms and opening up, of which Hong Kong plays a special role in enhancing infrastructural connectivity and regulatory coordination. Singapore is keen to partner Hong Kong in this endeavour. As former Guangdong Governor Mr Ma Xingrui often tells me, Singapore is an integral part of the development of Greater Bay Area. In addition, Singapore will continue to play its part in fostering closer economic integration and deeper regional connectivity within ASEAN to build an open and inclusive regional architecture.
28 Third, Singapore and Hong Kong can facilitate closer integration between our respective regions. One significant initiative is the Regional Comprehensive Economic Partnership (RCEP), the world’s largest Free Trade Agreement. Singapore strongly supports Hong Kong’s application to join the RCEP as an international financial, shipping and trading centre, and a key gateway for Mainland China.
29 Fourth, we should continue to invest in our young, so that the next generation of students, professionals and entrepreneurs from our two cities can build up friendships and bonds and form a network. We can do so through school exchange programmes and internships, and by encouraging further cross-investments and attachments by our companies. Singapore’s EnterpriseSG and the Hong Kong Trade and Development Council are already facilitating such collaborations. Ultimately, it is the multitude of personal relationships that underpin the strategic partnership between our cities.
Collaboration in Health
30 Finally, I should say something about collaboration in health, where there is much we can work on.
31 We have entered a new phase of the pandemic, where multiple variants are circulating in each society. They will combine and evolve, which means that there will be divergence in experiences and societal resilience in different parts of the world, including Hong Kong and Singapore.
32 As international cities, we are the canaries in the mine – very likely the first, to encounter new variants and pathogens, and what we do in response is an important reference to the rest of the world.
33 Singapore and Hong Kong can work together to strengthen our detection of variants and analysis of the level of societal resilience to them. Our findings will contribute towards the strengthening of a regional and global surveillance systems against the COVID-19 virus.
34 For example, we are exploring a collaboration with the Chinese University of Hong Kong on a prediction model that can estimate the population-level immunity against new COVID-19 strains and their potential severity, based on their genetic makeup. This will provide early information on emerging strains and enable us to respond more rapidly based on our risk assessment.
35 Further downstream, we can collaborate in the development of new treatments for diseases, especially in developing common protocols for clinical trials, and leveraging the diverse population and genetic pools of our regions, that can then expedite the developmental process. These are some of my suggestions.
36 Singapore looks forward to a stronger partnership between Hong Kong and Singapore, as we adjust to a new norm of living with COVID-19, in a post-pandemic world.