Singapore - Foreign policy

With a small population and no territorial ambitions or major strategic rivals, Singapore's global concerns are primarily economic in nature. It is a regional center for business and an increasingly important source of foreign investment in Asia. Despite a population of only three million people, Singapore's total volume of trade is the 13th highest in the world. In 1996, Singapore's importance in the economic growth of Asia was acknowledged as it hosted the World Trade Organization's first-ever meeting of trade ministers, with representatives from 160 countries.

Singapore's economic might gives Goh's government significant clout in the region, as in its 1994 decision to invest us$15 billion in development projects in Asia. Economic concerns, however, can also create rivalries. Singapore has had a longstanding rivalry with Hong Kong in areas like financial services, communications, and regional headquarters of major corporations. Singapore's government, which fears becoming too economically reliant on service sectors, wants very much to maintain a manufacturing base for its economy. This forces it into competition with neighboring Thailand, Indonesia, and Malaysia, which can offer improving infrastructures, larger markets, cheaper wages, and lower property costs to investors. Responding to some of these pressures, Goh announced that his government would review the major factors affecting Singapore's economic competitiveness.

Singapore's domestic policies have sometimes been a source of international conflict. Relations with the Philippines were strained in 1995 when a Filipino maid convicted of murder was executed. In 1994, the caning of an American teenager convicted of vandalism created tensions with the United States. During the most recent campaign, Goh reacted angrily when the U.S. government criticized the PAP for promising to consider electoral results when implementing its program of housing improvements.

Goh and Lee sparked diplomatic incidents with Malaysia in 1996 and 1997 with remarks which were taken as insults. Relations improved in April 1999, when Singapore conducted joint military exercises with Malaysia, a turnaround from 1998 when Malaysia withdrew from military exercises stipulated in the Five-Power Defense Agreement involving Australia, New Zealand, United Kingdom, Singapore, and Malaysia. The price of water supplied by Malaysia to Singapore, land reclamation, transportation links, and Singapore's fly-over use of Malaysian airspace, have been other chronic sources of conflict between the neighbors.

Although China and the United States are political rivals in Asia, good relations are maintained with both. The Goh government feels a significant cultural bond with China and enjoys growing economic ties to the country, although there is a strong sense of trade competition as well. The United States is already a major trading partner and has been granted access to Singapore's air and naval facilities. A ground-breaking and comprehensive free-trade pact between Singapore and the United States was signed by Goh and U.S. President Bush in May 2003. Goh has been a staunch supporter of the Bush administration's foreign policy, sharing intelligence with the United States and breaking up suspected terrorist plots. Singapore and the Philippines were the only Southeast Asian countries to support the U.S.-led invasion of Iraq in 2003. Singapore has been critical of its Muslim-majority neighbors, Indonesia and Malaysia, for being lax on Islamic militants.

Singapore is a member of the United Nations (UN) and occupied a rotational seat on the Security Council in 2001–02. Singapore has participated in UN peacekeeping/observer missions in Kuwait, Angola, Namibia, Cambodia, and East Timor. Singapore supports the concept of Southeast Asian regionalism and plays an active role in the Association of Southeast Asian Nations (ASEAN) and the Asia Pacific Economic Cooperation (APEC) forum.