NATIONAL DAY RALLY ADDRESS BY PRIME MINISTER GOH CHOK TONG AT THE UNIVERSITY CULTURAL CENTRE, NUS, ON SUNDAY, 18 AUGUST 2002, AT 8.00 PM

Rising Dragon

Our bigger challenge is from the rising dragon.

It is not just Singapore which has to adjust to China’s entry into the global marketplace. Hong Kong is even more worried. The Washington Post reported in June that five years after the return of Hong Kong to China, the main source of distress in Hong Kong was “not communism, but rather, too much capitalist competition (from China)”.

In the 60s and 70s, thousands of Chinese crossed the border in search of a better life in Hong Kong. These days, Hong Kong’s businessmen are headed in the opposite direction in search of profits. Even feng shui experts in Hong Kong are rearranging their furniture to improve their luck. They, too, have to ward off competition from China!

China’s transformation has indeed been spectacular. Singapore moved from Third World to First in 30 years. The whole of China cannot make it in 30 years. It is a huge country with a large rural base.

But Beijing, Shanghai and the big coastal cities can become First World in 30 years. They have already changed beyond recognition. It is not just the miles and miles of highway, the tall office buildings and the modern factories, but also the people’s mindset. I first went to China in 1971. When we left tips on the table, the waiters ran after us to return the tips. Today, every Chinese wants to get rich. They are eager to learn, and they learn fast.

Tan Kin Lian of NTUC Income went to Shanghai recently to sell them insurance know-how. He got a shock. Instead of buying from him, the Chinese offered him computer software for managing his insurance business! The product was good, and he bought it.

So how should we respond to the China challenge?

My response is: see China as an opportunity, not a threat. If we view China as a threat, we will be immobilised by fear. But if we see it as an opportunity, we will come up with creative ideas to ride on China’s growth.

We have built up a good relationship with China. In the early years, we shared our developmental experience with China. Even today, hundreds of Chinese officials visit Singapore every year, on study or training visits. In turn, we hope to benefit from China’s growth – not only Chinese Singaporeans, but also Malay, Indian and other Singaporeans.

For example, China’s growing middle class, expected to reach 400 million by 2010, will travel widely. We now receive half a million Chinese tourists every year. We will make it easier for Chinese nationals to visit Singapore.

Also, China has stepped up its “Venturing Out Policy”. The stock of China’s outward investments is now more than US$27 billion, up from almost nothing just 25 years ago. We should try to get a fair share of these investments.

Some Chinese companies are using Singapore to reach out to our region. One company uses Singapore to re-export its sewing machines to India. Another uses Singapore to sell washing machines, air-conditioners and motorcycles to ASEAN. Singapore businessmen should position themselves to partner such Chinese companies as they go overseas.

But to be able to take full advantage of these opportunities, Singaporeans should be proficient in Chinese. Already, some 25 million people outside China are learning Chinese, motivated by the enormous economic opportunities.

Our bilingual policy has given us an advantage which we should not lose. If we neglect the Chinese language, while others are picking it up, very soon, we will have no edge over them in doing business with China. I have therefore asked Teo Chee Hean to re-examine how we can improve the teaching of Chinese, and develop a core group of bilingual Chinese elite who understand China’s culture, history and contemporary developments. This will help Singaporeans when they do business with China.

Indeed, a Chinese tour guide expects more Singaporeans to work and live in China in future. One evening, he took a Singapore tour group to see the Suzhou Industrial Park. My brother-in-law was in the group. The tour guide told the Singapore tourists,

“This Park was built by your government. Look around you. Who knows? One day, your children and grandchildren may settle here!”

Whether they do or not, more of our students, especially scholarship holders, should be sent to study in the top universities in China. This will allow them to network with future Chinese leaders, officials and businessmen.

That is why Vice President Hu Jintao and I agreed on an exchange programme for bright university students. The first group of 50 Singapore students will visit China in June next year. The first group of 50 PRC students from top Chinese universities will come to Singapore two months later. This exchange programme could include dialogues with Ministers and senior civil servants, and visits to government agencies and industries.

If we are proficient in English and Chinese, if we understand China as well as we understand the West, we will be in a strong position to benefit from China’s growth.