Singapore's Next Premier Wong Warns US, China May 'Sleepwalk Into Conflict'


(Bloomberg) -- Singapore's prime minister-in-waiting Lawrence Wong warned that the US and China may "sleepwalk into conflict" if they don't engage with each other and deescalate rising tensions over Taiwan.

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In an interview on Monday with Bloomberg Editor-in-Chief John Micklethwait, Wong said the relationship between the world's biggest economies was on a "very worrying" trajectory in the wake of House Speaker Nancy Pelosi's visit to Taiwan and China's subsequent military drills around the island.

"We are starting to see a series of decisions being taken by both countries that will lead us into more and more dangerous territory," Wong, now serving as deputy prime minister and finance minister, said at the Finance Ministry office overlooking the central business district.

"As they say, no one deliberately wants to go into battle, but we sleepwalk into conflict," he added. "And that's the biggest problem and danger."

Wong expressed concern about a potential accident in the Taiwan Strait or South China Sea, citing a 2001 incident when an American spy plane made an emergency landing on China's southern Hainan Island after colliding with a Chinese jet. Beijing eventually released the crew after the US expressed regret.

"We worry about these sorts of near-misses and accidents and miscalculations, and we certainly hope that the leadership on both sides can continue to engage one another, especially at the highest level," he said. "And that sensible and rational decisions can be made to prevent things from worsening or deteriorating further."

Singapore has been one of the most vocal countries in Asia calling for the US and China to avoid a destructive clash that could quickly start to hit smaller countries in the region. A city-state dependent on trade, Singapore supports a strong American presence in Asia by allowing the US to access military facilities while also counting China as its top trading partner.

Tensions between the US and China remain elevated, with Beijing on Monday announcing fresh patrols around Taiwan to "fight back" against another congressional visit less than two weeks after Pelosi's trip. Earlier this month, China fired missiles that likely flew over Taipei during its most provocative military drills in decades.

The White House has sought to keep the relationship from deteriorating further, emphasizing that Congress is an independent branch of government and that there was no change to the US's "One China" policy. Prior to Pelosi's visit, the US and China had been working to organize the first in-person meeting between leaders Joe Biden and Xi Jinping, which could potentially take place later this year at a Group of 20 summit in Bali, Indonesia.

In the interview, Wong called on the US to engage more with Southeast Asia on trade, saying the recent launch of the Indo-Pacific Economic Framework should be "only the beginning." Critics of the framework, known as IPEF, have pointed out that it lacks any of the market access offered in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, the 11-nation trade deal Donald Trump withdrew from in 2017.

'More Divided and Dangerous World'

Singapore's goal, Wong said, was to create an "overlapping circle of friendships" in which all major powers have stakes in the region. He hailed the importance of the multilateral rules-based trading system that has underpinned the growth of many developing economies over the past few decades, saying a focus on concepts like "friend-shoring" -- touted last month by US Treasury Secretary Janet Yellen on a swing through Asia -- would make poorer countries in particular worse off.

Wong said the international community is entering a "new world order" in which trade, economics and finance are used as "instruments of geopolitical contests."

"The old logic used to be that with more trade we can tamp down geopolitical rivalries," he said. "Now there is another logic at play, which is geopolitics can undermine trade. And we worry about that, because this will lead us to a more divided and dangerous world."

(Updates with details in 11th paragraph)

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