Transcript of Minister for Trade and Industry Gan Kim Yong's Fireside Chat at the Economic Club of Washington, DC

Barbara Humpton: This year marks the 20th anniversary of the US-Singapore Free Trade Agreement (FTA). Minister Gan was appointed in 2021 and he came to this position with a really outstanding career in government but also in the private sector. Minister, I know you have been working to identify new growth sectors, you've been having productive meetings here in the US and I look forward to asking you questions that I'm sure are on the minds of our Economic Club today. First, I know you'd like to start with some opening remarks.

Minister Gan: Firstly, thank you for inviting me to the economic club. I'm here in Washington DC primarily for the 20th anniversary of the US-Singapore FTA. Not many of you know how the FTA started. It started from a golf game between (former) Prime Minister Goh Chok Tong and (former) President Bill Clinton. It was at night, and they were suffering from jetlag, so they decide, 'Why not we play a round of golf'. It was about to rain so PM Goh was thinking of cancelling the game, but decided to just go to the golf course and see how it goes - golfers are perpetual optimists, you see. They turned up at the golf course and the rain stopped right before they teed off and they were very happy. They finished a round of golf, and decided that from such a good outcome of golf, they should start negotiating the US-Singapore FTA.

Now, it's been 20 years. When we look back, other than the six-figure numbers that were mentioned, not many know that US has a trade surplus with Singapore and we are very happy to have that surplus and are not about to file Section 301. We want to continue to work with the US on how we can continue to strengthen our collaboration bilaterally, as well as on a multilateral platform.

Looking ahead, there are a few things I would like to share with you - some observations of the changing landscape since we started the FTA negotiations 20 years ago. First, there is significant reorganisation of alliances. In the past, 20 years ago when we started FTA negotiations, many countries were working on a free trade, reducing trade barriers to facilitate trade and investment. Many countries benefited from that. Increasingly, if you look back at the last few years with the conflict in Ukraine, the war in the Middle East, and US-China tensions, I think things are beginning to change. There is really a reorganisation of alliances in the trading environment.

Secondly, there is the restructuring of global supply chain. All of you are very familiar with friend-shoring and onshoring. This will create a real reorganisation of the global supply chain and today, many businesses, Siemens included, their supply chains are integrated and to reorganise them poses significant challenges. At the end, if you don't do it carefully, it will add cost to the global economic system.

Thirdly, there is also a reallocation of priorities. Increasingly, national security has been a key consideration. Sometimes it overwrites economic considerations. As a result of this, you are going to see a lot more export controls, import controls, even restrictions on technology and trade. These are the trends that we are seeing over the last few years and it's going to continue for quite some time to come. But at the same time, we must ask ourselves, what we should do, and how do we respond. Particularly for Singapore, as a very small country with an open economy, we depend on trade for our growth and trade for our growth and development. The free trade has been beneficial to us, despite the fact that we have a trade deficit with the US.

Let me share some of my thoughts. First, we will need to build on our shared interests and focus on deepening our collaboration that we already have, expanding the areas that we can work on. Between US and Singapore, for example, we established the Partnership for Growth and Innovation (PGI), between (the Ministry of Trade and Industry) and the Department of Commerce. This PGI focuses on innovation efforts and how we can collaborate in innovation, including AI and various technology. Then last year, we had the inaugural dialogue session on Critical and Emerging Technology (CET) - that's between Singapore and the National Security Council (NCS). These are the platforms that we are developing and evolving. If you look back, we were able to develop these two very important platforms partly because we have had the FTA for 20 years. Over the 20-year journey, we built trust, understanding and we know how each other thinks, and we are able to trust one another to develop new platforms for collaboration. PGI and the CET dialogue are not the traditional FTAs that we talked about, and at the same time FTAs are still very important.

Within ASEAN, we have also been pushing ahead with FTAs. ASEAN has just upgraded their FTA with Australia and New Zealand. We are now expanding our FTA to include Canada, where there's going to be a new FTA between ASEAN and Canada.

Second, beyond these traditional FTAs we will also need to think about new models of collaboration and evolve new platforms for us to work together. The Indo-Pacific Economic Framework (IPEF) is one such platform that we have developed. It is challenging because you must imagine that it's a collection of countries from Asia-Pacific including US and they are all at different levels of development, different stages of readiness to collaborate, and there were different interests and different concerns. Over the last one to two years, we have been working very hard to forge consensus and we have now completed our pillar on supply chain. We are going to sign two agreements on clean economy and fair economy sometime early next month. We have made progress and we hope that at some point in time we will also have the trade pillar completed. We do understand that there are challenges but at the right time, we will have the trade pillar.

These are new platforms for collaboration, and I must make a sales pitch here. Next month, on 5 and 6 June, in Singapore, we are organising the first inaugural investor forum on clean economy. We're bringing together projects as well as investors and financial institutions, to match the projects with funding. This is very important and provides tangible benefits because it helps countries in IPEF to push ahead with their developmental plans and to help them facilitate their journey towards a sustainable future.

These are areas that we are working on, on new models of collaboration. For such new models to work, I always tell my (colleagues), you can negotiate whatever you want to negotiate but eventually, it's the businessman that makes the money. You can have a lot of agreements but if the businessmen are not investing or trading, then the agreements are not very useful. So, I encourage businessmen, and all of you here, please think about how you can tap on these agreements. In Singapore, we have an agency that helps businesses to tap on this all these agreements and we advise on which is the best for you. So if you're in Singapore like Siemens, do talk to us. We will help you tap on the most advantageous agreement.

This brings me to the third and final suggestion that I have in response to changes in the landscape. And that is for all of us to actively seek out new areas of collaboration and new areas of opportunities. There are two in my mind.

The first one is on sustainability. Sustainability and climate change is a new and emerging sector and there'll be new industries that are going to develop and emerge. There'll be new skills that will require new services to be in demand. Particularly, I want to talk about renewable energy. Over the next five years, ASEAN alone is going to see a 7% growth per annum in terms of renewable energy, and we would really like to encourage you to work with Singapore under the US-Singapore Climate Partnership. This is something that we are pushing ahead with.

We are very interested in your input on what are the things that should go into the partnership and how do we make the partnership work for you, so that it will meet your needs in investing in green energy. We have completed the first phase of feasibility studies on regional energy connectivity in ASEAN, and we are going to embark on phase two pretty soon.

Another area that is quite critical, is the digital economy. Digitalisation has picked up speed - we used to have physical meetings but now we have Zoom meetings instead. You may not believe it but there was a day when we had a board meeting (one of the boards in Singapore) where we used to have a board lunch. We decided to have a Zoom lunch, and we will Uber lunch to every one of them. Unfortunately, in the board meeting, there was one board director that was a resident in the US so we had to apologise and say, well, "We owe you one and we'll send you a meal ticket. You can go to McDonald's and help yourself".

I think the digital economy is going to be a key game changer. My worry is that many of us are not quite ready for this revolution. It is important for us to move ahead quickly, particularly on the regulations and governance of digitalisation / digital economy. All of us talk about e-commerce, but there are a lot of other issues including data privacy and so on.

But my sense is that while we are discussing, negotiating and sorting it out, the digital economy itself is moving ahead because there is economic impetus for digitalisation to happen. It is important for us to sit down very quickly to deal with these emerging technologies. Singapore has entered into digital economy agreements with many countries. We have one with Australia, New Zealand, Chile, Korea, and the UK, and we are about to enter into one with the EU - we are in the midst of negotiations. I think we are moving ahead. The advantage of this digital agreement is that it lays down the rules and governance as well as interoperable protocols. It is important for countries around the world to come together to see how we can develop this bilateral or multilateral digital economy agreement. I think this may be a relatively sensitive topic in the US context, because data privacy is something that is very difficult to deal with. But in time to come we should be able to overcome these challenges. We can start by thinking about some of the possible pilots that we can do, small-scale so as to test the system, and this way we can then be more confident in moving ahead.

Among all these, there are many opportunities, whether it is in the green economy, digital economy, but I would imagine that one of the key challenges that all of you have in your mind is the relationship between US and China and I will talk more about this later. But suffice to say that all the trading partners of US and China all want to have a stable relationship between them. Stability and certainty are some things that businesses all need to have. Difficulties, challenges, costs - all these are manageable, but uncertainty is something that businesses would rather not have. A stable uncertain relationship is something that is very important for countries in this region and there will be opportunities in the region to exploit many of these emerging technologies.

And Singapore is well placed to help US companies. As you said, we have 6,000 companies operating in Singapore. Many of you here already have a presence in Singapore. And I look forward to continue with you. Someone asked me just now - Gary (CEO/CES) asked, "What are your tax incentives that you are prepared to give?" My answer is always this - Do not worry about tax incentives. Come and talk to us, and we will ask you what do you need. Then we will figure out how to make sure that you will invest in Singapore or give you an offer that you cannot refuse. Within limits, of course. So I was trying to talk to Gary about setting up CES in Singapore, and he said that Singapore is too small. We will continue to discuss. Singapore is very small; we are slightly smaller than New York. But together with ASEAN and the Asia Pacific, we have a huge market. You may know Taylor Swift, she was in Singapore. Quite a lot of our neighbours also thought that Singapore is too small for Taylor Swift, but eventually we indeed had Taylor Swift with us.

In conclusion, let me let me say that today we are operating in a very challenging and uncertain environment. But there are also many opportunities for us to do business together and to also grow together. I really look forward to partnering some of you across new opportunities in the region and that the economic relationship between us and Singapore will continue to deepen and broaden bringing benefits to Singaporeans and Americans. Thank you very much.

Humpton: Thank you, Minister. And I want to illustrate to you the importance of this smaller than New York country that in this global economy, the Siemens corporation headquartered in Munich, Germany, annually runs a competition for country of year. Now Siemens USA is 25% of Siemens business globally, but who won last year? Singapore! So yes, stellar, stellar player on many stages. Thanks for the overview. Thanks for framing up the situation that we are in now. I would love to bring the trade agreement to life as you look back over these last 20 years. Are there particular accomplishments you are proud of?

Minister: I would not say it is my accomplishment because in Singapore, we work as a team. The biggest challenge that has happened (?), put it the other way, is the battle against COVID-19. At that time, I was unfortunately the health minister. I wish I was the Trade and Industry Minister. At the health ministry, we were right at the forefront, but I was very fortunate because I had a very good team - a very strong team. And this is a team of ministers, so I was not alone. We had a ministerial task force that oversaw the response to COVID-19. I was the chairman, and I chaired the ministerial committee, with Lawrence Wong who is our Singapore's next prime minister, was my co-chairman. Two of us worked together to see how we can manage COVID-19.

Our instruction from our Prime Minister, Mr. Lee Hsien Loong, was very clear - "You must minimise the loss of lives, but you must also make sure to minimise the loss of livelihood". So our motto in the ministerial task force was save lives, save livelihood. It was a balance of between lives and livelihood. I think all of you have gone through that. There were a lot of challenges, and we thought it was difficult to lockdown. We had one lockdown, but it turned out that is a lot more difficult to open up. Because every time you open up, infections go up, and we had to figure out what to do. But I was very fortunate to have a very strong team of ministers, working with me to deal with the situation. But that experience was one of the most rewarding in the sense that we were able to forge a very strong bond among the team.

And it is not just the ministers because with the ministers, we can discuss and make decisions but, in the end, it is the executives and the officers on the ground that have to deliver. We were also very fortunate to have a very strong team of executive officers that were able to implement all the measures right on the dot, specific to the instruction. Because you can imagine when we decide to close the border, you have to decide which country to close down, how to identify where you came from. You might have transferred from somewhere else, how do we track these, and if you have been to Changi Airport, it is a huge place. And how do we make sure that they don't intermingle? These were some challenges that we just told the officers to figure it out, and they figured it out. We have a very good team of officers on the ground, and that is how we managed it. That experience has helped us to forge a very strong bond among the team.

Humpton: Well, I want to turn our conversation to this tough topic of relationship between the US and China and how that impacts Singapore. And you are obviously a trusted trading partner of both countries. How are you navigating the relationship that currently exists and give us a perspective of what this looks like from Singapore?

Minister: I see my Ambassador smiling. Maybe I should ask him to answer the question. This is a very difficult question, it is somewhat a trick question. But I must say that US and China have the most influential relationship, the most consequential relationship. The relationship between US and China affects not just two countries, but the rest of the world. And therefore, Singapore and many other countries are watching the development of this relationship very closely. I think from Singapore's perspective, we have concluded that the competition and contestation between the two will continue and it will probably intensify over time. But that is not the most worrying part, because Singapore is very used to competition. We are an open economy and compete with everybody in the world. Competition is not the most worrying part. What is more worrying is the relationship and the trust and understanding between the two.

It will be useful to encourage both sides to continue to have dialogue and engagement, so that while you compete, there is understanding of where you are and what you are doing, to minimise misunderstanding and misinterpretation of the intention. I think that is very critical. I am very happy to see that this contact has resumed. And I hope that this will in fact to continue to grow. There are multiple channels of communication. And in this regard, I would imagine that businessmen also play a very important part. Siemens for example, has a lot of presence in China as well. If you can be the interlocutor, talk about how you can improve the relationship between the two so that you can compete on a fair and reasonable basis - that will benefit all of us.

But at the same time, there are also areas and challenges, particularly global challenges that we need everyone to be on board. One example is climate change. I think you need both US, China and everybody else in the world to be on board climate change so that we are able to address the issue with a global solution. Singapore is at the brunt of it because we have very limited renewable energy, so we are very keen to talk about renewable energy as a project. We rely primarily on natural gas, and we have solar, but when we cover every inch of our island, which is not very big, it provides less than 5 per cent of our energy needs. It really is not sufficient, so we are looking at import of electricity to solve that problem. But of course, imports are not cheap, they are costly because you need long distance cables, but it is something that we are prepared to invest in because we want to be responsible in terms of climate change.

We made a commitment at the Climate Summit on our target to reach net-zero emissions, carbon neutral by 2050. This is something that we work very hard to watch. We want to make sure that everyone else comes along as well. One particular issue that the Ministry of Trade and Industry is unhappy with is that we have a carbon tax. Singapore is the first country in Asia to introduce a carbon tax. But of course, my environment minister is very happy because it sends a signal to the industry: guys, you know the writing is on the wall. We are serious about climate change. You had better buckle up and make sure that you transit to a more sustainable model because otherwise carbon tax will begin to bite. We not only announced the carbon tax but also announced the schedule of increase in the carbon tax over the next few years just to make sure that you do not miss the message. And Singapore - of course, (coming) from the Ministry of Trade and Industry, I must defend the industry and say, you must give us time, this and that - but eventually, collectively, we made a decision that this is the right thing to do. Painful as it may be, we will have to proceed with it. We have done what we said we would do - we have actually introduced a carbon tax and the first increase has already been implemented early this year.

Humpton: And what has been the impact?

Minister: Well, we are working with the industries. Today, the tax rate is still very small and we give them time to adjust. But the key is that the notice is on the wall so you had better move. What we promise is that we are going to help you transit. If you need to invest in decarbonisation technology and so on, we are happy to support you because the revenue that we collect from the carbon tax, we are going to plough it back into helping industries to invest and to decarbonise. Because we are serious about this and we are bearing the cost of decarbonisation, it is important that the whole world comes along as well. This way, then we can achieve our target together.

Humpton: I just want to applaud the work that Singapore is doing in a leadership role to help with this transition. I recognise this is a really tricky issue politically, but I think history is going to show that those who recognise the financial impact of not adapting are actually doing a service for us because businesses everywhere need to make their business case, and having the financial aspects factored in is going to help us move the business equation along. Now, it's interesting because I had the privilege of attending the Sydney energy forum a couple of years ago, and ASEAN plays a key role in diversifying the supply chains for the renewable energy field. And so here we are, we have got a world that was disrupted by COVID supply chains that were broken, the need for more resilience in the supply chain. Everybody is talking about "glocal" - doing things more locally but taking advantage of global innovation. How are all of this affecting trade and how are you adapting to the changing supply chains?

Minister: The supply chain will continue to reorganise itself because of the "glocalisation" that you coined. We do understand that there are challenges domestically, and there are security concerns. You want to ensure that your supply chain is resilient. So all these are factors that you need to take into account but there is also an economic case to (be made). Even with the "glocalisation", you need to optimise your supply chains. Singapore has been a hub for almost everything. We are a hub for tourists. We are a hub for financial services. We are a hub for shipping and we are a hub for communication, data flow and everything. We also want to be a hub for supply chains, which we already are. Many of the companies are in Singapore, which play a very significant role as a critical node in the global supply chain. We want to continue doing that, and the way to do that is for Singapore to continue to remain a trusted partner, a trusted supplier in the supply chain. Let me give you an example. During COVID-19, many of the ports around the world were shut down because workers fell sick and they were not able to deliver the cargo. In Singapore, we made sure that the seaport and the airport operated 24/7 to make sure that we delivered the goods that the customers and businesses needed to meet their obligations. We want to demonstrate that we are a reliable partner. When you have your business with us, we will make sure to deliver our promises. In that way, it gives you confidence that we can be a node in your critical supply chain. This is how we try to carve out a niche for ourselves in a global restructuring of supply chains.

Humpton: And now I want to make sure that if this room, this Economic Club of Washington wanted to contribute to correcting this imbalance in our global trade, how could businesses here go about increasing their engagement?

Minister: I would encourage you to talk to our ambassador here. He will give you all the information that you need about investing in Singapore and we will be very happy to welcome you to come to Singapore. The Economic Club can organise a mission - maybe we can have a session, a dialogue with the Economic Club in Singapore. We will welcome you and do not worry about tax incentives and this and that. We will design the schemes that you need. Because we have a lot of schemes - governments are like that with all kinds of schemes. I know, because on my first day on the job as the Minister of Trade and Industry, a lot of companies asked me, "what are the schemes that you have that I can tap on?" It is very complicated to explain 20 schemes to them; by the time, we reach the 15^th, they would have forgotten the previous ones. So I told them, "don't worry, you just come to us. If you need and your needs are justified, we will find a scheme to suit you. (If) we do not have a scheme, we will design a scheme to suit you. So that is how we are pro-business; we want to lean forward to support the businesses to make sure that your businesses are successful in Singapore. But I also want to encourage you to think of your investment in Singapore as not just for the Singapore market, because the Singapore market is very small. By all imagination, we are a very small country, a very small island. But our proposition is that Singapore is a gateway to the Asia Pacific region, particularly ASEAN. ASEAN, as all of you would know, is a fast-growing area. It has political stability and economic growth, and it has potential for the next 10 to 20 years. So I will encourage you to look at Singapore as a gateway, as a stepping stone to the rest of Asia and ASEAN.

Humpton: Thank you so much and thank you for being so approachable. I have learned something here today and that has really got me thinking. If that original Free Trade Agreement began on a golf course - everybody may recall that we have got the Solheim Cup coming to Washington DC this September - what a great opportunity for us to refresh some trade agreements and truly lay the foundation for 20 years of future business.

Gary Shapiro, Consumer Technology Association: Thank you, Barbara. Thank you, Minister for your great remarks. Singapore is definitely swinging up. Could you answer three questions? First of all, what is it, other than a carbon tax, that is Singapore's biggest challenge? Second of all, what is the biggest challenge to doing business with the US? And third of all when your Prime Minister played golf with Bill Clinton, did he get mulligans?

Minister: We just have to decide the result of the score before the game started!

On your first question, there are challenges Singapore would face like many other countries. We have a limited market as I have mentioned and our workforce is also very limited. So we would not be able to accommodate labour intensive industries. So we will have to decide which are the industries that we need. We are also short on energy, therefore we would have to take a second look at energy-intensive industries. But we are very keen to look for solutions. I'll give you an example. We are very keen to attract Data Centres to Singapore and every country is attracting Data Centres to their countries. I remember talking to some of the platform operators who want to put their Data Centre in Singapore. My response to them was "please do not put it in Singapore", and they said "Why? Everybody wants it, but why doe Singapore not want one?" I said that we do not have the power that they need but please put it in Batam, which is next to Singapore. (Batam) belong to Indonesia. Or put it in Johor; that belongs to Malaysia. Then you connect with Singapore and you have an entire ecosystem. You benefit from the green energy that they have, and we can preserve our energy for other data centres. We are also looking at Data Centres that are more strategic and more critical for business growth and not the usual storage because data centre is a warehouse of data. We want to make sure that the data centre is strategic and high value in terms of the data and operation it runs. These are the things that we are rethinking how can we reorganise ourselves to address challenges that we are facing. So whatever challenge you have, tell us and we are very excited to solve these challenges.

With the US, we have always had a very good working relationship. But of course, the US is a very big country and Singapore is very small, so that is the imbalance that is very difficult to manage. But we are able to talk to each other on equal footing. What is more important is that we need to understand that each other's concerns are very different. As a small country, open economy in the midst of ASEAN, we have a lot of opportunities, but we also have challenges. And the US is maybe the exact opposite. You have a very huge, large country, your concerns and opportunities are also very different. I think the way to solve this difficulty is really to have a frank and open discussion. Usually I would spend time with my counterpart, whether it's Gina (Raimondo) or Katherine Tai. Sometimes, over formal discussion with all officials there, it is very difficult to talk about some more intricate issues or sensitive issues, so sometimes, from time to time, I bring them to (eat) durians in Singapore. During the durian makan, as we call it, we will say: "these are the issues - can we work something out?" This is how we try to solve problems and overcome difficulties, sometimes in an unconventional way, but it works, particularly for Singapore and other countries.

Humpton: Do you have a special visitor, a good representation from the US coming to your June gathering?

Minister: We do have some US Secretaries that are coming to Singapore. I won't tell you who, until the Secretary is prepared to announce, in the right time. We are planning to have an IPEF Ministerial meeting in Singapore, so some of the Ministers in the region will also be gathering in Singapore, in conjunction with the Investor Forum.

Humpton: I've got to ask you about Taylor Swift. I mean, it's a force to be reckoned with, in (terms of) economic impact. Tell us about it.

Minister: This, you would have to ask the younger generation. I have no idea why, but beyond a doubt, she is very popular. In my generation, our singers are of a different genre. Taylor Swift speaks to the heart and feelings of many generations, young and old; so you can see different groups of people queuing up (at her concert). And for Singapore, I think our main attraction is really the ease of transport; the ease of connectivity. A lot of her fans and audience flew in from around the region to attend her concert.

Brett Scola with RSM us LLP: Many family offices as they look for putting their offices and global presence have considered Singapore. Can you share any comments on why family offices should consider Singapore as an office for headquarter?

Minister: One key consideration that these family offices have in their mind, is that the Singapore system is very transparent. The rules are very clear. So you comply with the rules, you set up your family office in Singapore, and that's that. Singapore, also as a node in Asia, provides a lot of investment opportunities for your funds to be based out of Singapore, so that you can invest out of Singapore.

And partly also because of the connectivity if you are going to invest in the region. Singapore is a very good place for you to be in because we have connections to everywhere. We even have direct flights to New York, although that is 18 hours. And when you talk about businesses like family office or Siemens, it is not just the family office or the company, but it's an entire ecosystem. We are already a financial centre, and we have very high standard legal services. So for family offices, they are all looking for high-quality services, consistency, transparency, so that they are quite confident that the money that they're putting in Singapore will be safe, and the convenience and investing out of Singapore. These are key attractions for such family offices.

Andrew Salinger, Foreign Policy: Minister thank you so much for the excellent discussion and talking points. Obviously, Singapore has an opportunity with what's happened in Hong Kong, and a lot of fantastic organisations have taken advantage of that. A dynamic that has sprung out of that is the cost of living in Singapore and real estate prices in particular. I'm happy to tell you that I have actually recently hired someone from Singapore who has moved to the US because of that. And I was curious how Singapore is addressing this as is obviously a problem the world over not just in Singapore, but a very important point when it comes to staffing and resources in the region.

Minister: Thank you very much. From Singapore's perspective, we do want our Singaporeans to have good salary. If the US is able to pay him higher, that's good too. But we have to accept that, Singapore with our limited land and limited manpower, cannot be a cheap place to operate in. Which is why I had mentioned that, if you're in labour intensive industries, it is very difficult for you to be viable in Singapore.

Despite the high level of cost that Singapore is seeing today, we want to mitigate the cost, by offering you a very efficient government system. A very transparent regulatory system and a very establish and enhanced infrastructure that will allow your business to operate smoothly, successfully, that no other countries can equal. So despite the costs, it will make your investment in Singapore worthwhile. That's our main selling point. If we are going to compete on Singapore being cheaper than Hong Kong, or Abu Dhabi, I think it's going to be very difficult, and eventually something will have to give. We have to continue to maintain Singapore's efficiency, productivity and the forward-looking government policies and regulations. This way, we make Singapore a very attractive place for business.

Alfonso Guzman, J.P. Morgan. Thank you Minister for your time today. I know prior to your current role, you were also at the helm of the Ministerial Committee on Ageing, which is very quickly becoming a hot topic in many more high-income countries. So can you give us some insight as to how you were able to work through that in Singapore and maybe some advice you would have for other countries that are seemingly going to be challenged with an ageing population relative to others.

Minister: Thank you very much. My portfolio was called Minister-in-Charge of Ageing, but many people called me the Ageing Minister, and I've had to repeatedly correct that.

(An ageing population) is a problem that every country is facing, and I had a visited many countries to find a solution. Very often, when I arrived at the country, they would tell me that I was at the wrong place, because they didn't have a solution. And eventually, we decided that we will have to find our own way out of this problem. But to take one step back, what is ageing? When I was the Minister for Health, in-charge of ageing, I was at the World Health Organization, talking about ageing population. So, I made a proposition I said today seniors are classified as 60 years old. So how about redefining it to 70 years old? Then immediately, your ageing population becomes halved.

Humpton: 70 is the new 60? I love it.

Minister: Yes, because ageing is a number. What matters really is your functionality, your health. If 70 is the new 60 - i.e. if you stay as healthy as 60 - then 70 is not a problem. We need to focus on solving the functionality and health issues, not the age issue. You can't stop ageing; you can have cosmetics and so on, but it doesn't stop ageing. So we focus on the health, and introduced a programme called Healthier SG. We start from young, we enrol everybody into the programme. When Singaporeans see a doctor in Singapore, the doctor would ask, "What did you eat yesterday? Did you get enough exercise last week?" If you didn't, they will prescribe social intervention - for example, you must do 10,000 steps a day, etc. The idea is to incentivise them, to keep them healthy. But this is harder than it seems, because simply telling people does not work, because previously, the doctors are paid every time you have a problem. If you're healthy, they don't get paid. So financial incentives are not aligned. Now we have flipped it around. We say that we're going to pay you a sum of money for the number of patients you look after. If they're healthy, you keep the money. If they're sick, you use the money to pay. That way, we make sure that doctors' interests are aligned. But I must tell you that this is still work in progress. We need to do this in steps, we need to restructure the primary care system and healthcare system, including financial payment system; step by step as we move towards a Healthier SG so that we are able to minimise the impact of ageing, not just the number. I hope that answers your question.

Usman Ahmed, PayPal: Certainly, Singapore is a hub for international global businesses but also a thriving small business landscape. I'm curious for your thoughts on trade agreements and the policies that you've thought about that could be most helpful for small businesses.

Minister: So in fact, trade agreements are very important for small businesses, because they are not able to have global operation to optimise their supply chain, and therefore if they operate in Singapore, they need to have access to markets. This is how we help them. Trade agreements, as I explained earlier, once you sign a trade agreement, it sits there and doesn't do anything unless you tap on it. So we have set up centres, what we call SME centres, to help these enterprises see which other trade agreements that will benefit them to help them export to these countries. In Singapore, frankly, we have very little tax, very little tariff.

For businesses, they are facing global competition today, even with or without FTAs. So FTAs will help them by providing them access to other countries and not just in terms of tariff concessions, but also more transparent rules in terms of trade. So for them, it is a benefit for particularly for SMES.

Humpton: Minister Gan Kim Yong, we would love to keep you here for the entire afternoon, but we know that you have other obligations and Canada is next. Thank you so much for visiting the Economic Club of Washington.

Minister: Thank you.

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