The current global economic downturn will change the worldwide power structure, giving China and India a stronger role to play in the future, Singapore’s foreign minister said Tuesday.
“China and India will continue to grow and by the time this is all over, the global landscape will look quite different,” George Yeo told a group of visiting foreign journalists. “The U.S. will remain pre-eminent for a long time to come, but the U.S. will have to act with the full recognition that there are many poles (of power).” Singapore’s economy is expected to contract between 2 and 5 percent this year, the Ministry of Trade and Industry said last month. Right now, all countries affected by the downturn — including Singapore — are focused on the domestic impact, Yeo said. But the Singaporean foreign minister said he foresees the situation affecting the small city-state’s relationship with its various allies — particularly with China and India. “So however the world turns, we have deep links to the West, Japan, and old links to China and India that we’ll deepen,” Yeo said. Last month, Singapore’s ministry of trade said the country’s economy shrank by more than 4 percent in the fourth quarter of 2008. Singapore’s economy grew just over 1 percent for the entire year compared to a robust growth of 7.8 percent a year earlier, the ministry added.
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“It’s a complex world … we’ve got to think through very carefully and ask ourselves what our strengths, what our weaknesses are, and how should we respond,” Yeo said. Yeo, who previously served as Singapore’s finance minister, said the downturn has frightened investors away from the current financial system. India, meanwhile, called on the G-20 leaders to take “credible decisions” to halt the global meltdown as they meet in London. Prime Minister Manmohan Singh, in a statement before leaving for the UK to attend the summit, also opposed protectionism as a way to deal with the crisis. “It is important and necessary for the summit to take credible decisions which will help to halt and reverse the current slowdown and to instill a sense of confidence in the global economy,” he said. Singh also called for ensuring “adequate flow of finances” to the developing countries and for ensuring reform and restructuring of global financial institutions. “The time has come for the international economic and financial architecture to reflect contemporary economic strengths,” he remarked. The Indian leader insisted that the “fundamentals” of his country’s economy remained strong.