SINGAPORE — Following a closely watched visit to Beijing, China that ended on Monday (June 19), United States Secretary of State Anthony Blinken said that his country was seeking to “de-risk and diversify” from China, but not to 'decouple' from it.
SINGAPORE — Following a closely watched visit to Beijing, China that ended on Monday , United States Secretary of State Anthony Blinken said that his country was seeking to “de-risk and diversify” from China, but not to"decouple" from it.
In China’s view, however, such comments from officials in the US are merely a play on words or diplomatic jargon, with a commentary by the official Xinhua News Agency on June 10 describing this as “just old wine in a new bottle”. "It means protecting a narrow set of advanced technologies critical for our national security,” he said.
Dr Chong Ja Ian, a political scientist from the National University of Singapore, told TODAY that de-risking and diversifying essentially means for the US and its allies to be less dependent on the China economy, “especially for key elements of its supply chain”.Dr Chong added that this differs from the Trump-era decoupling which supposedly aimed to separate the US and China's economies, which was “not practically possible except at great cost”.
A day after the group’s communique was issued, China barred operators of key domestic infrastructure from purchasing products from Micron, citing security risks. It had neither provided details on what risks it had found nor what Micron products would be affected. Ms Selena Ling, head of treasury and research at OCBC bank, said that while the impact on Singapore arising from such a shift in the US' strategy is difficult to ascertain as of now, the de-risk and diversify strategy is the current status quo, where foreign direct investment is increasingly headed towards Southeast Asia.
Given that Singapore has been acting as an economic conduit for the US, EU, the United Kingdom, Japan, China, Southeast Asia and South Asia since China’s opening in the late 1970s, de-risking and diversification would likely reduce some of the gains for Singapore in the short to medium term, said Dr Chong.
Dr Oh added: “Singapore is an international financial and trading hub, and so it will continue to play its crucial role regardless of who the trading partners are.”
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