CHAPTER V

SINGAPORE 1 S SECURITY AND THE EXTRA-REGIONAL POWERS: INTERESTS AND RESPONSES

CHAPTER V

SINGAPORE 1 S SECURITY AHD THE EXTRA­REGIONAL POWERS: INTERESTS AND RESPONSES

Following the British decision of withdrawal in 1967

' and keeping in view its hightened security concerns, the

form of linkages that Singapore should have with the external

powers acquired utmost policy significance. To get the

maximum advantages in terms of security with the least cost

was a challenging diplomatic exercise. The possibility for

gaining such an advantage was how to manipulate itself into

the sphere of interest of a great power. This could be done

by demonstrating that a hostile superpower could gain a

Btrategic preponderence if given access to the area.

Singapore's immediate concern was the pattern of inter-

action of the big powers in Southeast Asia. Although these

powers had maintained dialogue among themselves, from the

point of view of Singapore leaders, fhis sort of detente had

not led to any meaningful reduction in international power

1 politics. In Southeast Asia the influence of the big powers

had continued to be felt. China was likely to re-assert its

influence over this region (which ~t had been doing centuries

before southeast Asia came under the impact of Western colonalisr

1The Nation, (Singapore), 5 September 1972,, p.4.

217

Its support to the various communist movements had alceady

been a source of concern to the national governments in the

region. The U.S.S.R. was also keen to move into Southeast

Asia partly to counter-balance the influence of China and also

to have access to the Indian and Pacific Oceans for its fast

growing naval strength. Japan, another major power, had looked

upon the region not only as a source of valuable raw materials

as well as markets for its products but also as an important

waterway through which most of its oil supplies from West Asia

had to pass.

Wi·th the depart·1re of European colonialism the United

States was the only major power in Southeast Asia. Apart from

their military involvement in Indochina, the Americans also had

substantial milltar.y bases in 'rhail~;d l.iY~ the Philippines, the

two countries in the region whj_ch had joined the u.s.-sponsored

Southeast Asia Treaty Organization (SEATO). To Singapore,

the presence of the United States was of utmost importance

for the overall stability of the region. 2 The Americans,

according to Singapore leaders had endeavoured to thwart the

expansion of communists' influence and encroachment in the

region. In a speech given at the Asian Business Briefing

organised by the Financ:~<?-~_!_i_rne_~ (London) in Bangkok on 28 June,

1976, foJJ.~r Hinister s. R.ajaratnam observed:

2see Chan Heng chee & Obaid ul Haq, ed., ]."'he Prophetic and the Political: Selected spPeches & writings of S.Rajaratnam; (Singapore, New York, 1987), pp.291-93.

218

Given the present uncertainty of the Americans about their role in South and Southeast Asia, they might readily agree to a somewhat more etherial presence in Southeast Asia. As it is they have withdrawn from Vietnam. There is at best only a symbolic presence in Thailand. There are rumours about cutting down en commit­ments in Korea and Taiwan. After their experi­ence in Vietnam and the readiness with which Asians take up anti-American causes, one can understand if Americans have developed an aversion for Asia and things Asian. 'J'he current strategic thinking in the United States appears to be of an island defense system with mainland Asia excluded and only with Japan at the peri­phery. Let me be quite frank about this. Should we in Southeast Asia willingly or unwillingly encourage this trend in the United States then what we would in fact achieve is not a region free of great power domination but an area exposed to the tnfl uence of one great power - the Soviet Union.,.,.

In so far as the Soviet Union is concerned, there is no doubt about the role she intends to play in the region. Her policy in regard to South east Asia is activist, consistent, and credible ••••

And as far as Si.ngapore is concerned, we will continue to maintain gooq relations with the Soviet Union but at the same time resist, on our own, or through the collective strength that ASEAN provides, any Soviet influence or pressure which we believe would be detrimental to our national interests or to our non-communist way of life.(3)

The leaders in Singapore seemed to entertain two possible

fears. First, any sudden decision by the US government to with-

draw from the region could lead to a scramble for influence

by the world's major powers not interested in regional stability.

This might lead to ihstability in the region. Quite possibly,

it implied that China would not object to continued American

3rbid, pp.293-94.

-

219

influence mainly because premature withdrawal by the United

States would tantamount to inviting the Soviet Union to

exert its influence in the region. In view of the existing

power balance and the territorial and the ideological conflictf

with the U.s.s.R., the Chinese would rather tolerate American

than soviet presence. The second reason could be attri-

buted to the Singapore leaders' belief that the Southeast

Asian states were currently undergoing a cri-tical stage of

economic and political development. The resolve on the part

of the ruling elites to build up non-communist political systen

could be seriously shakened, if America chose to opt out of the

region. Prime Minister Lee Kuan Yew stressed this point in a

speech at a banquet in honour of the American Vice-President in

April 1970. He observed:

What Southeast Asia needs is a climate of confidence, continuing security and stability in which constructive endeavour can become rewarding. It also need to have the spirit of success. This spirit can be gener(ited as enthusiasm spreads when their own efforts brings growth and progress. Time-tabling and fixing dates will negate both the climate of confide:nce and the spirit of success ••• A4) ·

It was because of this time-gaining perception that the

Singapore leaders did not show much optimism over the US-Demo-

cratic Republic of Vietnam agreement on Ending the War and

Restoring Peace in January 1973. In Singapore's view the agree

ment did not guarantee peace in the region since the basic

sources of conflict had not ceased to exist.

4Asia Pacific Rscords, vol.l, No.1, April 1970, p.17.

It is with this perception in mind that: the extra­

regional power's interests and stakes in the geo-politically

significant and economically viable Singapore should be studied

as it figures into their foreign policy calculations. In this

regard, an analysis of the policies of China, Japan, the Soviet

Union and Australia, their ability to influence Singapore's

foreign policy and its concern for security and the Singapore

government's responses towards the same would be in order here.

As regards the US policies for the

separate chapter is devoted to the

Singapore and the Peoples' Republic of China

purpose of convience a

5 same.

Singapore's attitude towards China's approach tO\-lards

the region during 1970s could be better explained and understood

in the context of the latter's interests in Southeast Asia, its

state of relations with the ASEAN states and its rivalry with

the Great Powers.

Lying on its southern periphery, historically Southeast

Asia had been of interest to China. In recent years it happened

to be a region in which its rivals had attempted to exert and

expand their influence at it~ expense·. As such, it had always

feared that one or more of them, acting on its own or in

"colusion" with each other, may encourage Southeast Asian states

to adopt anti-Chinese policies or setup organizations

5see Chapter VI.

2ll

aimed against China itself. As a result, of its objectives in

the region had been to convince the Southeast Asian countries

not to align themselves with its rivals. The other had been

to seek minimization of the activities and influPnce of its

opponent.~ while expanding its mm. 'rhe regional states ;·Jhich

refus~d to adopt a nonaligned approach in their foreign policies

and, on the contrary, were more favourably disposed to its

rivals than to itself were considered unsympathetic to Chinese

6 interests.

China's initial reaction to ASEAN were influenced by its

belief that the five founder members v.;ere not only inimical to

its interests but were receptive to attempts by its major rivals ·

the US in particular - to contain the expansion of its influence.

The state of relations between the ASEN~ countries on the one

hand and China, the US and the U.s.s.R. on the other appeared

to indicate that the former were favourably disposed towards

L'"hina • s rivals.

When ASEAN was formed in 1967, four of its founder members-

Singapore, the Philippines, Thailand, and Malaysia- had neither

recognized nor had diplomatic relations with China. Only one,

Indonesia, had formal ties which were suspended following the

1965 coup in Jakarta. In contrast, all the five countries had

diplomatic relations with the u.s., then considered by China to

6Khaw Guat Hoon, "Recent Developments in Chlna-ASEAN Relations", Southeast Asian Affairs, 1979, p.61.

222

be its major adversary. Not only this, two of them- the

Philippines and Thailand- had not only bilateral security

arrangements with Washington but had also been members of

the Southeast Asia Treaty Organization (SEATO) which was

undeniably an US-sponsored organization aimed at containing

the expansion of Chinese communism in Southeast Asia. While

the other three ASEAN countries - Indonesia, Malaysia and

Singapore - had no security arrangements with the u.s. nor had

·thHy joined SEATO. They were, nevertheless, known to have pro-

u.s. orientation and were sympathetic to the American goal of

containing China.

Given the perception of these countries as hostile to

its interests and sympathetic to the anti-Chinese and anti-

communist objectives of the u.s., Beijing looked upon the

Association as pro-American and anti-Chinese. It considered

ASEAN to be a "military alliance directed specially against

C:.."hina" brought into existence by the "reactionary cliques" in

7 these five countries at the "behest" of the u.s.

Along with its criticism of ASEAN being a "tool of u.s.

imperialism", China also alleged that it was an instrument of

Soviet "Social imperialism". The Chinese leaders thought that

the Americans and the soviets were . 8

common goal of containing China.

in "Collusion" in aff_M&r/Ly

Although,,Beijing

7Peking Review, 18 August 1967, p.40.

8 Khaw Guat Hoon, n.6, p.62.

their

at that

223

time directed its barage of criticism on u.s., it also tended

to look upon the Soviet: Union as a threat to its interests and

was growing suspicious of Soviet moves in the region. It

perceived any improvement in ASEAN- Soviet relations as an

indication of "collusion" against itself and of ASEAN's anti-

Chinese sentiments.

Singapore and Chinaz Diplomatic Considerations

The political image projected by China and its geo-

graphical proximity made it a central reference point in

Singapore's foreign policy and security considerations. The

question of diplomatic relations with China was quite complex.

The Singapore leaders considered the Chinese behaviour in the

region as detrimental to their national interest because of

certain reasons. First, the Chinese had been consistently

supporting the communist led liberation movements of Southeast

9 Asia by giving moral and also material support to them. It

was these forces which had launched insurgency movements against

the established governments of most of the Southeast Asian

states. Although as a result of growing normalization in Sino-

u.s. relations in 1971-72, China had reduced its highly provo-

cative attitude towards these states, it had not softened it

10 altogether.

9see Dick Wilson, The Neutralization of Southeast Asia (New York, London, 1976), p.117.

10Ibid, p.118. ~--

224

Secondly, China had been giving asylum to the leaders

of various communist parties of Southeast Asia. The first

vice-chairman of the Communist Party of Burma, U Ba Thein T±n,

and the leading central committee member of the Communist Party

of Indonesia, Jusuf Adjitorop, were among the two outstanding

exiles resident in China. The latter was the leader of what

had remained of the pro-Chinese group within the comnunist Party

of Indonesia. Besides, A senior leader of the Communist Party

of Malaya had on occasion made an appearance in Beijing. 11

The third irritating factor was no less importan·t.

The position of the overseas Chinese in Southeast Asia had been

difficult and controversial all along. In the years immediately

following the Bandung Conference in April 1955, Prime Hinister (.'0({.1'\{h..i<A

Chou-en-Lai had encouraged the Chinese in Southeast Asian,.to

become citizens of the states in which they reside. 12 The ouch

Nationality Treaty, which China had concluded with Indonesia in

1958 was an example of this changed chinese position (in the frame

work of which the local Chinese in Indonesia were given the

option to decide between Indonesian or Chinese citizenship, v•ith

the Chinese government accepting the responsib1.li ty ;for re­

patriation of those who chose Chinese citizenship. 13

11stratts Time-s(Kuala Lumpur), 10 September 1967, p.13.

12Beijing Review(Beijing), 7 June 1965, p.lO.

13Ibid.

225

A deviation from this new policy approach came when

China had been going through 'cultural revolution'. The

Chinese government changed its position encouraging the over­

seas Chinese to rebel against the host governments and incul­

cate Maoist revolutionary ethos. It was flagrant intervention

of this kind during the period of the cultural revolution,

particularly in Burma, a country (which had been quite friendly.

to China earlier) that dismayed ahd alarmed the Southeast Asian

governments.

Though in a formal diplomatic sense, Singapore did not

maintain any diplomatic relations with Beijing, it did not lose

sight of the fact that many of its citizens identified themselves

with Mao and his thoughts as well as the PRC. An unknown number

of Singaporean Chinese were both culturally and ideologically

prone to the Chauvinistic appeals from the PRC. Also many of

them had family relations in China. The SingRpore government

believed that it must be cautious in making any decision to

establish diplomatic relations with the People's Republic of

China. In this connection it must' first consider the effects

of Chinese Chauvinism. Secondly, it could not ignore a widely

held opinion among the Singaporeans that any rapproachment with

Beijing would help the communist opposition in the country. A

shift in the already tenuous balance between the right and the

left in Chinese community would impose significant stratns on

the nation-building process in Singapore. Moreover, recognition

of the Peoples• Republic, the establishment of embassy and the

~sultant influx of diplomats and employees of the New China

226

News Agency would also alarm Singapore's neighbours and

friends especially Malaysia and Indonesia.14

In the 1960s nelther China nor Singapore felt that

their security would be enhanced by extending diplomatic

recognition to or establishing relation with each other. 15

However, keeping in view the traumatic changes in the

regional and global setting, there was a growing conviction

in both the countries that a normalization in their relations

would be in their national interests. Both sides had their

own reason for wanting such an improvement.

China had become increasingly concerned with the Soviet

Union's activities in Asia and less perturbed with those of the

u.s., especially as it interpreted American disengagement from

Vietnam and the Nixon Doctrine (which called for a lesser Americ

military role) as an indication of waning u.s. power in the

region. China did not want to see the u.s.S.Ro emerging as the

major power in the wake of the perceptible decline

in the American influence. This was all the more so since the

u.s. had begun to indicate a willingness to improve its

relations with Beijing. 16

14see Pang Cheng Lian, "Why Singapore needs to move cautiously in its relations with China", New Nation(Singapore), 9 March 1972, p.6.

15straits Times(Singapore), 13 July 1965, p.3.

16Khaw Guat Hoon, n.6, p.63.

227

China viewed the Soviet President Leonid Brezhnew's proposal

for an Asian collective security system, first announced about

three months after the Sino-S-JViet armed clashes across the

Ussuri River in March 1969, as not only an attempt to encircle

China but as evidence of Soviet desire to replace the u.s. as

the major power in Asia. 17 Faced with this growing Soviet

concern, China paid more and more attention to improve its

relations with Southeast Asian countries.

At this juncture, Singapore on its part was also re-

evaluating its policy towards Beijing in the wake of certain

international developments which had an effect on its own

security and the political stability of the region. These

developments were.Britain's desire to withdraw East of Suez

and abrogate the Anglo-Malayan Defense Agreement, the announce­

ment of the Nixon Doctrine and President Nixon's move t~ improve

relations with China and the us decision to disengage from

Vietnam. All these developments induced Singapore to shoulder

a greater responsibility for its own security and survival.

The British decisions were of direct relevance to

Singapore. Singapore realised that it had to be self-reliant

in external defense. That is why it showed its uneasiness over

the new power configuration emerging in the aftermath of the

British withdrawal and u.s. disengagement. At the same time it

1crBeijing Review(Beijing), 10 July 1969, p.l.

229

it was still confronted with the Chinese inspired and supported "ft.. Y<.at" 1

f communist subversion. It thought that a friendlier pollcy

towards Beijing ~ight make it less inclined to render suppprt

to communist insurgencies in the area. 17

Thus, in the early 1970s, Singapore began to make efforts

to improve relations with China. This led to exchange of trade

and sports delegations and building of co;1tacts, both at the

official and nonofficial levels. 18

Singapore's relations with China had improved consider-

ably by the mid-1970s. Beijing no longer viewed ASEAN as an

anti-Chinese association opposed to its interests. At the same-

time, because China no longer viewed the u.s. as its major rival,

it stopped criticising Singapore's relations-with Washington.

By 1975, Beijing was expressing its support for ASEAN and praising

its aims and achievements. 19

On 10 May 1976, Lee Kuan Yew 'paid a visit to China.

Although there were no diplomatic relations between the two

countries, the Chinese gave the Singaporean Prime Minister a

warm welcome. Premier Hua-Kuo-Feng indeed noted that Singapore

leader's visit would "certainly help enhance the mutual under-

20 standing and friendly relations" between the two countries.

17straits Times(Singapore), 5 January 1969, p.4.

18~bid, 10 February 1970, p.5.

19rbid, 3 October 1975, p.17.

20Beijing ReviE:!W, 13 May 1976, p.1.

229

On 11 May, nua Kuo Feng gave China's strongest endorse-

ment of the political and economic objectives of the ASEAN

describing as "posi.tive" its proposal for the establishment of 21

a zone of peace, freedom and neutrality in Southeast Asia.

Ass~~/ng the Singaporean guest Prime Minister, he observed:

"China is a developing socialist country belonging to the Third­

World. No country has a right to carry out aggression subver~

sion, control, interference, or bullying against other countries. 22

China will never be a super-power now or in the near future".

yew Responding to Hua Kuo Feng's views, Lee Kuan commented

" on China's position vis-a-vis the region, especially towards

the ASEAN and said:

China has expressed her support for ASEAN. I hop(El, others inside and outside the region, will also understand the objectives of ASEAN and support •••• That of the big countries, China is the one nearest to Southeast Asia. Indeed, she is .a part of Asia, and her p)licies will be a major factor in the evolving situation in Southeast Asia. I hope, after this visit, our relations will grow and broaden. On many inter­national issues at the United Nations, we have found ourselves in agreement with you. However, it is to be expected that there will be difference of views in some areas because of different national interests or ideology. These need not prevent us from improving our aultural, trade and other relations.(23)

At the Fifth National Peoples' Congress held in 1978,

Hua Kuo Feng expressed his Government's wish to establish diplo­

matic relations with all countries, particularly with Singapore

and Indonesia. 24

21see Asian Recorder, 15-21 July 1976, p.13257. Beijing ~eview(Beiji~g), 13 May 1976, p.l.

22 Ibid.

23. Ibh( _

230

As regards diplomatic relations, Singapore leaders had

stated on many occasions that their country would be the last

among the ASEAN group to do so. Their argument was that normal-

ization of diplomatic relations with China could take place

only after Indonesia had acted first. 25 This showed how

important Indonesia figured in their foreign policy calculations.

Later, during Teng Hsiao Peng's visit to Singapore in

November 1978, Lee Kuan Yew told the Chinese leader that

Singaporean Chinese were carving out a future for themselves

in the region and that they realized that their fate depended

"directly on Singapore's future in Southeast Asia and not on

26 China's future among the front ranks of industrial nations".

Singaporeans have come to realize that just as they canot afford to sacrifice their national interests for China, so they cannot expect China to sacrifice her national interests for Singapore. (27)

Singapore and China: Economic Interaction

Since its'independence and particularly after the British

decision of withdrawal, Singapore had been pressing forward with

the strategy of economic development focused on industrialization

and the import of technology for the development of oil, electroni

24Beijing Review(Beijing), 15 February 1978, p.11.

25straits Times(Singapore), 9 June 1978, p.4.

26 Asia Week, 24 November 1978, p.13.

231

and shipping industries. In the pursuance of its industrial!-

zation policy, it favoured free trade in order to encourage

exports. China had a huge population, large ma~ket and subs-

tantial natural resources while, on the contrary, Singapore

lacked natural resources and had a limited market. It had to

rely on the resources of other countries and international

market for its economic survival. For this reason despite its

political differences Singapore attached much importance to

increase cooperation with Chinese, in the fields of economy,

trade and technology. Singapore sought to achieve this objective

through realistic attitude of its leaders towards China and

through the long-term efforts made by the commercial, industrial,

and financial circles of these two couocries. China's adoption

of the policy of opening up to the outside world in 1979 had

resulted in a major break~hrough in Singapore-China economic

relations, with the scope for co-operation extending from trade

to other fields, to the mutual advantage of both the countries.

The analysis of the trade statistics given in the table '

(Table 1 shows that although the grade between Singapore and s

China grew in volume fromr$ 593.25 million in 1969 toS$ 906.2

million in 1978, its percentage in the Singapore's total external

trade gradually declined from 5.4 percent in 1969 to 1.7 percent

in 1978. The total import from China grew from US $ 113.4 million

in 1968 to us $ 420.91 million in 1980. Similarly export from

Singapore grew from US $ 46.80 million in 1968 to US $ 189.85

million in 1980.

Table 1

Singapore's Trade With China, 1968-1980 ( S $ million)

232

~-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.- -.-.-.-.-.-.-.-.-.-.-.-.-.-.-Year Imports Exports Total Trade %age Singapore's

$ $ $ total trade ----1968 113.40 46.80 160.20(US $m) o:';

(US $m) (US $m)

1969 418.49 174.76 593.25 5.40

1970 385.5 69.4 454.9 3.70

1971 406.7 46.6 453.3 3.2

1972 399.1 57.4 456.3 2.9

1973 573.2 128.4 701.6 3.3

1974 443.9 125.8 769.7 2.2

1975 682.0 98.5 780.5 2.4

1976 659.0 95.4 755.4 1.9

1977 670.4 144.7 815.1 1.8

1978 775.5 130.7 906.2 1.7

1919 296.45 104.70 401.15 (US $m) (US $m) (US $m)

1980 420.91 189.85 610.76 (IDS $m) (US Sm) (US $m)

.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.

Source: Singapore Facts and Pictures, 1969-1978. (Singapore, A Ministry of Culture Publication) and International Monetary Fund, International Financial Statistics and Yearbook 1981; Ministry of Foreign Economic Relations and Trade, China, Almanac of China's Foreign Economic Relations and Trade.

233

The Singapore-China trade rose considerably since the

two countries had signed a trade agreement in December 1979.

Total trade turnover reached US $ 0.401 billion in that year,

and US $ 0•610 billion in 198o. 29

Singapore and Japan

It would be useful tm approach Singapore's ties with

Japan in the overall Japanese ASEAN/regional perspective. After

its military retreat from southeast Asia at the end of the

Second World War, Japan had managed to return to the region

and reasserted its influence in a ver',' different way. It was

first through reparation arrangements, and later through trade

and aid with individual Southeast Asian countries. With the

United States as its ally and with guaranteetfsecurity provided

to it under the US-Japan Mutual Security Pact, Japan was able to

focus its attention and marshal its resources for the resurgence

of economic power, while leaving all foreign policy initiatives

in the region to the Americans. Interestingly, by the nineteen

seventies, Japan had already overtaken the United States in its

trade with Southeast Asia. As economic ties between Japan and

Southeast Asia grew and as Japan's own global ec~nomy expanded,

the region of Southeast Asia in general and the five ASEAN

countries in particular had become increasingly important to

Japan because of many reasons. First, the region was one of the

major supplier of raw materials for Japan's grO\ving industries.

Secondly, the region was a substantial market for Japanese exports,

Thirdly, ASEAN was an important area for Japan's overseas investmen

28 See Table 1.

In addition, the geographical location of the area also

provided vital link between Japan and the countries in Europe,

West Asia, Africa, and South-Western Asia. It was estimated

that approximately 40 percent of Japan's world imports and 78

percent of its vital crude oil supplies passed through the

Straits of Malacca. Goods from Australia and New Zealand also

had to pass through Makassar Straits.

Poli t.ically, the ASEAN count:r:-ies 1.vere important to Japan

mainly in the context of the Asia-Pacific region and its global

strategy. With their basically anti-communist governments and

with economies integrated with the non-communist nations, five

ASEAN countries were seen by the Japanese as allies of their

country in the regional balance of power. The Japanese support

and cooperation to them would definitely enhance Japan's position

in the international community while their political stability

and friendly disposition would guarantee Japan the accessibility

to its most vital life-line, the straits of Malacca. Strategi­

cally it was the main watersway for the Japanese fleet to reach

the Indian Ocean.

Japanese Prime Minister, Fukuda for the first time (year

not available) in Japan's post-war diplomatic history, putforth

publicly Jap-=m 1 s policy towards Southeast Asia. The main points

of the Fukuda Doctrine were that Japan will (i) not become a

military power; (2) pursue "heart to heart" understanding with

the ASEAN countries not only in politics and economies but also

social and cultural spheres; (3) cooperate with ASEAN as an

235

"equal partner" in its effort to consolidate its members and

to strengthen their resilience while, at the sametime, try

29 to establish relations with the Indochinese states.

Singapore's Response

Keeping the above perspective in mind the Singapore

leaders thought that the active cooperation with Japan, a

strongest non-military, non-communist economic power in the

region, would enhance economic progress and ensure political

survival of the Republic. This was all the more assuring for

them to note that Japan had become the most likely friend and

supporter of the ASEAN. Although prior to 1966 Singaporeans we.

critical of both individual Japanese and Japan as a whole.

Memories of Japanese atrocities committed by them during the

30 war and the brutalities perpetrated by them during the occu-

pation period (1942-45) lingered in the minds of ·the

Singaporean people· in general and those ·in authority in

particular. Relations between Japanese business~n and their

counterparts in Singapore were strained because the Japanese,

on occasion, had shown themselves to be arrogant, clanish, and

disinterested in anything 'other than observing their own customs

and making the best possible business dea1. 31

29Lai Fung-wai, Frances, Wibhout A Vision: Japan's Relations with ASEAN, Occasional Papers, No.1Q(Singapore: Nation University of Singapore), 1981, p.S.

30 Straits Times(Singapore), 5 July 1966, p.2.

31see Kenneth Young, Southeast Asian Attitude and Expectations concernin;J Japan(New York, 1970), pp.23-4.

236

Initially, the delicate question of reparations to

Southeast Asian countries under its occupation had checked the

establishment of normal relations until 1956. 32 Continuing

negotiations regarding the quantum and quality of the repara­

tions enabled Japan to enter into Southeast Asia - in the mid-

nineteen fifties. In most cases Japan offered credits which were

tied to the purchase of capital goods manufactured in Japan

along with dmvestment participation and exchange of products.

The Japanese continued to place heavy reliance on Southeast

Asia for its natural resources.

The relationship between Singapore and Japan since 1965

had been one of inter-dependence and respect for. each other's

capabilities. Keeping in view its own development priorities,

Singapore welcomed increased Japanese investments and a higher

proportion of exports to Japan. On 25 September 1967, during

Primier Sato visit to Singapore, Prime Minister Lee Kuan Yew

in his welcome speech, told his Japanese counterpart:

That Chapter (of Japanese occupation) is closed although not forgotten •••• Twentyfive years ago it would have been impossible to imagine the circum­stances which have enabled my colleagues and me to welcome you to Singapore today.

How it happened is the history of the last twenty­five years. Perhaps everyone has grown a little wiser in the meanwhile.(33)

32see Eisaku Sato, Prime Minister of Japan, "Some countries have misgivings about Japan", reprinted in Asia­Pacific Record Basic Documents and vital speeches, vol.l, no.S, August 1970_ pp.12-16.

33cited in Straits Times, 25 September 1967, p.1.

237

As regards Japanese businessmen, diplomats and tourists,

there was considerably less anti-Japanese sentiment in Singapore

than in other Southeast Asian countries under Japanese occupation.

In course of time there had grown a degree of commonality of

interest, especially in the Singaporean and Japanese business

relationships because Singapore had a stable political climate,

a labour movement usually under control, and a government

34 oriented towards economic development.

Economic Cooperation

Japan entered into agreement in 1967, 1970, 1972 and

1973. In the field of economic interaction, Singapore and

Japan had under these agreements made a commitment to Singapore

of¥ 12,740 million (roughl~S$ 106.2 million) in loans and I

provided¥ 2,,40 million (roughly S $ 24.5 million) in grants. 35

The economic assistance extended by Japan was used for constru-

cting a shipyard, a satallite earth station, a thermal power

plant etc.

In May 1977, the Japanese government decided to support

a petro-chemical complex project in Singapore_ the total cost

of which was estimated to be¥ 180 billion. 36 It was expected

to contribute to the growth of Singapore's economy and as a

consequence, greatly enhahce the existing frrendly relations

between the two countries.

34 Far Eastern Economic Review, vol.68, No.13, !,1arch 26, 1970, p.6s.

35outline of Japan's Basic Policies And Japan-Singapore Relations(Ministry of Foreign Affairs, Japan, 1977), p.12.

36Ibid. -

238

As regards government-sponsored technical cooperation,

Japan had accepted 1,455 trainees from Singapore and dispatched

593 experts during 1966-1976, and material and equipment worth

V 37 million by March 1977. In 1970-71 the Japanese provided

assistance to the tune of ¥ 51 million under technical coopera-

tion in the construction of a Japanese garden in Jurong. Anothei

project carried out under Japan's technical cooperation scheme

was the Prototype Production and Training Centre to which Japan

supplled personnel as well as ¥ 195 million worth of equipment

between 1966 and 1972.

Investment from Japan

Japanese investment in Singapore also showed a rapid

rise. 37 According to an estimate, from an investment equi.valent

to S $ 27 million in 1965, it had risen to S $ 61 million by

1970, thus showing more than a double increase. 38 As of the end

of March 1977, the balance of Japanese investments in Singapore

stoodi•.et: US $ 278 million, an increase of us $ 52 million since

March 1976. 39 Japanese investments occupied 1' percent of the

total amount of foreign investments in Singapore, which ranked

Japan as Singapore's third largest invester country after ·the

United States and the United Kingdom. 40

37 See Pang Cheng Lian, "Long-term welcome", Far Eastern Economic Review, vol.25, No.lO, 4 March 1972, p.65.

38Ibid.

39outline of Japna's Basic Policies and Japan Singapore Relations, no.~6, p.12.

40Ibid.

239

By June 1977, the number of Japan-Singapore joint

ventures in Singapore had grown to be about 250 (projected

enterprises). About 180 of these were in the manufacturing

field. Joint ventures between the two countries covered a

wide variety of industries, such as shipbuilding, industrial

machinery, precision machinery, chemical production, foodstuff

production, construction, insurance, transportation and so on.

Trade

In the field of trade the balance of trade between

Singapore and Japan had, since 1963, been heavily weighted in

Japan's favour. The ratio of trade deficit remained low until

1969 when imports from Japan took a quantum jump and it conti­

nued through 1970s. Officials in Singapore had been concerned

at this severe imbalance in bilateral trade. Although they

demonstrated their ability to cover this continuing balance

of trade deficit with invisible income (i.e. tourist spending

in Singapore, etc.) over a long period, the problem was c~ng

great difficulties. There was a continuing demand in Singapore

for Japanese finished products (e.g. motor cycles, television

sets, etc). On their part, the manufacturers in Singapore were

finding it nearly impossible to sett their finished good in

the Japanese market, thus causing imbalance in trade. This

could be seen from the data given. ;., ~ \table 2 •

Table 2

Singapore's Trade with Japan, 1968-1980 (S $ million)

240

.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.- .. Year Imports Exports Total Trade %Singapore's

$ $ $ total trade

1968 971.7 10.8

1969 1018.89 336.31 1355.20 12.34

1970 1458.0 /65'· 8 832.0 14.1

1971 1699.6 379.8 2 079.4 14.8

1972 1874.5 392.4 2266.9 14.5

1973 2295.5 713.3 3008.8 14.1

1974 36 53.9 1610.5 5264.4 15.2

1975 3254.3 1112.9 4367.2 13.6

1976 3590.8 1668.8 5259.6 13.6

1977 4474.0 1918.1 6392.1 14.0

1978 5668.2 22 26. 0 7894.2 15.0

1979 3025.3 1189.2 4214.5

1980 Jan/ 4166.8 1797 5964.3 June

.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-. Sourcez Singapore, Singapore Facts and Pictures,

A Ministry of Culture Publication,and Department of Statistics, Singapore.

241

An analysis of the above data shows that despite this

imbalance in trade, year after year Singapore's trade with

Japan had been growing steadily. After West Malaysia Japan

became the second largest trade partner which maintained a

trade amo~nting toS$ 971.7 million or 10.8 percent of Singcpore•s

total trade in 1968. This represented an increased ofS$ 267.5

million over that of 1967. Total trade increased from S $ 971.7

million in 1968 to S $ 1,355.2 million in 1969. Japan had taken

over from West Malaysia as Singapore's leading t~ade partner

since 1970. Singapore's total trade with Japan rose to 2079.4

• million in 1971. This accounted for 14.8 percent of the Republics

total trade. In 1974 Japan which accounted for 15.2 percent of

Singapore's total trade, became the Republic's leading trade

partner. Japan had been among the Singapore's three leading

partners in 1977 accounting for 14 percent of total trade and

retained its leading position in 1978 contributing 15 percent

to Singapore's total ~rade.

By commodity, products of the heavy and chemical industries

accounted for 82 percent of Japan's exports to Singapore. Main

items included machinery, ships, iron and steel. As for Japan's

imports from Singapore, pE:!troleum products occupied an over-

whelmingly large share of 71 percent in 1976. The increase in

Japan's imports from Singapore in 1976, particularly petroleum

products (56 percent i.ncrease over the previous year), palm oil

45 percent, textile yarn and threa~ 129 percent, and crude

rubber 35 percent, contributed substantially towards the

realization of balanced trade relations, which were still in

42 Japan's favour.

- ..,..,.

242

Singapore and Soviet Union

Singapore leaders had observed that the threat to the

security of the Republic came not only from the internal

communist subversion or China, but also from direct Soviet

involvement in the region. Soviet Union's condemnation of

ASEAN (since its incept1.on in 1967), its role in the

~Karrtpll.clllean- problem·, it~ security 't;:reaty· with-

Socialist Republic . of Vietnam in November 1978, and i·ts

general anti-U.s. policy both at the regional and the global

level, had made Singapore leaders aware of the fact that Soviet

Union had become power to be reckon with in the region. Thus

the Soviet aims in Southeast Asia and the challenge thei.r actions

posed to the interest of the ASEAN countries, as ,,.,ell_ as China

and United States provided the main refet'ence for Singa;,Jore 's

threat perceptions. It Honld therefore be important to have a

clear view of the Soviet objectives and ambitions in the reglon

and the Singapore's responses toward the same.

The Soviet Union had for long, important, if not vital,

interests in South East Asia. These flowed from several consi-

derations. The first related to the free use of the seas for . 43

navigation by Soviet naval and merchant vessels. The second

43George K. Osborn III, Balance of Power in Southeast Asia, Occasional Paper No.S3, Institute of Southeast Asian Studies(Singapore), 1978, p.1S.

243

represented an attempt on the part of the Soviet Union to kpu.bL~~

prevent the peoples 'JI China·. ·and U.s. influence from growing

in the region, the third emanated from the Soviet Union's

desire to expand its political and economic influence where

feasible. The last related to its inclination to provide an

alternative source for communist ideological inspiration in

a region where many communist parties looked to it for such

44 ideological guidance.

The Soviet Union's strategic interest in the freedom of

navi,Jation through Southeast Aslan Waters was natural. Despite

improvements in land transport between Europe and the Soviet

Far East and increased use of Arctic shipping over the past

several years, sea lanes passing through Southeast Asitin

region remained an important link between the eastern and western

extremities of the u.s.s.R. In a narrow military sense, the

maintenance of balanced fleet deployments on a worldwide scale

enhanced Soviet interest in the regional straits and the South

China sea. The continuous Soviet naval presence in the Indian

Ocean could play a role in the Southeast Asian strategic balance.

Maintenance of such a presence by deployments through the South

China Sea also provided visible evidence of Soviet interest.

The acquisition of Soviet base facilities in Danang and Cam

Ranh Bay bases in the SRV caused both regional and extra-

reg onal states to reevaluate their relations with the Soviet

Union.

244

There could be little doubt that for several years the

U.s.s.R. had embarked on a policy of containing China. The

Soviet President Leonid Brezhnev's call for an ASian collPctive

security arrangement was primarily directed against China, only

secondarily at the u.s •• In this context the Soviet support to

Vietnam and Laos are two instanceso The Soviets had made

available large-scale assistance to the S.R.V. and then there

was large scale infusion of Soviet advisors in Laos. These

clearly showed the concrete efforts on their p~1rt to check the

expansion of Peoples' Republic of China's influence in Southeast

Asia. Soviet support to the SRV in the latter's hostilities

with Kampurchaa rather reinforced the PRC's apprehensions. It

seemed unlikely that the U.s.s.R. would abandon its efforts to

limit the PRC's influence. 45 Conversely, one could argue that

it was the Chinese pol~cies that were pushing the SRV towards

a closer ambraces with the Soviet Union. It was in this context

that the ASEAN's particularly Indonesia's and Malaysia's concern

that emanated from the growing rivalry between China and the

Soviet Union in the region, should be appraised.

Added to the importance of the sea-lanes was the trade

the Soviet Union conducted with the Southeast Asian state,

especially in such raw materials as rubber. The expansion of

Soviet political and ec,)nomic influence was directed towards

convincing Southeast Asians that the U.s.s.R. did provide a

model for successful economic development for less developed

countries. 46

45George K. Osborn III,

46_, . ~

n.44, - p.16.

245

Thus, the rationale for the Soviet Union's presence

in the Straits of Malacca area was predicated upon its interests

in keeping the sea-lanes open from the Baltic ports of Western

Russia to the far eastern parts of eastern Russia. From Moscow's

point of view there were two important reasons for the Southeast

Asian sea-lanes :to.- remain open and avai !able for passage. The

first involved the deployment and "free passage of its fleet,

the second involved trade which although slowly growing in

importance, did not matfh t.he significance of the fact of the

47 Soviet naval presence in the Pacific and Indian Oceans.

Singapore shared the ASEAN's concerns about the Soviet

objectives and policy manifestation in the region. The

Soviet Union extensively used the straits of Malacca for its

warships, trawlers, and larger commercial ships. Although

greatly concerned, Singapore permitted the Soviet Union to frJY

use its facilities fueling, minor repair facilities, and as I'

a port of call for its ships. In 1970 approximately 520 Soviet

ships, most of them trawlers and fighters, availed themselves

of Singapore's services. 48 Singapore lay in the middle of the

arc w~ich began in the Baltic sea, extended around the cape of

Good Hope to Singapore, and from Singapore to Vladivostok. The

Soviet Ministry of Sea Transportation viewed Singapore as an

ideal repaj.r and replenishment point and focal point for

operations in Asia. 49

47~bi~ p.59.

48The New Nation, 28 August 1971, p.3.

49see Alex Josey, Lee Kuan Yew, Revised Edition(Singa­

pore, 1971), p.586.

246

In keeping with these long-term and varied interests

in the region, the Soviet Union had been condemning the ASEAN

since its inception in August 1967. In the first few years the

Soviet Union perceived it as a "client of Capitalism". The

Soviet Union also claimed that t.he Pentagon planned to merge

ASEru~ with the Asia-Pacific Council (ASPAC) into one great

military bloc. The central theme of Moscow's condemnation was

the nature of ASEAN's relationship with Washington. The Soviet

Union's viow of ASEAN could be explained in various ways: Firstly,

1'-Ioscow interpreted the formation of ASEAN as a hostile .~hti-

corrununist organization aimed at halting the march of socialism

in the region; seconruy, its hostility could be underst0od in

the context of US 1~ies with the Association. All the five ASEAN

states were generally pro-West and especially pro.US in their

policy orientation. Thirdly, Moscow feared that ASEAN would

become a viable military pact, replacing the ineffective SEATO.

Finally, the Soviet Union's hostility could only have been

heightened by the fact that ASEAN was an area of considerable

importance but one where the Soviet influence was minima1. 50

Singapore's Responses

The international changes that had taken place since the

late 1960s had a tremendous impact on Singapore's policy towards

big power. Its policy towards the Soviet Union during 1970s

was the product of several factors like the latter's role in

the Kampurchean crisis of 1975, its security treaty of 1978 with

Vietnam, its anti-US policy and its critical attitude towards

50Bilveer Singh, ~iet Relations with ASEAN 1967-88 (Singapore, 1989), p.37.

ASEAN countries. Although Soviet Union did not rank as a

country of major importance to Singapore, Singa9ore had been

trying to maintain an equal distance with any of the major

powers, especially to avoid the image of playing a suppo~tive

role for the one that was looking for a foothold in this area.

As early as in 1967 an agreement had been reached between

Singapore and the Soviet Union that 11 ships 11 of the latter could

use the Singapore facilities. At that time there was no mention

of naval vessels, and as a result this question remained a topic

for speculation. 51 In September 1970 while in Europe P:t;j.me

Minister Lee Kuan Yew stated that Singapore would repair any

vessel from any country, provided that the peaceful conditions 5 ~yew

were maintained. 2 In March 1971, Lee,emphasized that the Soviet

naval presence in the I:r..dian and Pacific Oceans and the South

China Sea constituted a needed counter-balance to the presence

of the major powers. 53 Acco~ding to some press reports, a Soviet

technical mission had been in Singapore in February 1971, and

that the party included naval experts who had'been shown around

Sernbawang, the Naval Ship Yard. They were reported to be

interested in bunkering and repair facilities.

In November 1971, the defense arrangements agreed upon

by the Commonwealth Five Power Group went into effect. Australia•

Britain, and New zealand had stationed naval units at Sernbawang,

51New Nation(Singapore), 29 March 1971, p.3.

52Alex Josey, Lee Kuan Yew, revised edn., p.586.

53straits Times(Singapore), 28 March 1971, p.11.

249

in accordance with the defense agreement. Also, from time to

time ships of the u.s. Seventh Fleet used the facilities there.

The members of the Five-Power Defense Group were known to

have been making representation to Singapore government to

restrict Soviet usage of Singapore's facilities to commercial

shipping. 5 4

It was doubtful U~ether refusal of permission to Soviet

naval shipping to use Singapore's facilities would impair the

relations between Singapore and the Soviet Union. Moscow

had been cautious in its comments regarding Lee Kuan Yew's

stance. It had chosen, however, to speak on this question

in a different way. In December 1971 Moscow attacked the Five-

Power defense arrangements as being directed towards maintaining

the hegemony of Britain and SEATO in Southeast Asia. 55 In

January 1972 Radio Mosco,., asserted that the United States had

penetrated Singapore and that 11 Singapore had long since become

56 a land of promise for u.s. monopolies ...

As a matter of fact, following the British decision to

withdraw from the region, and the US decision t1j> 'll.sianise'

the Vietnam war as well as to lower its posture in the region,

Singapore along with other ASEAN emmbers had begun to look upon

the Soviet Union for future leverage against the incoming Chinese

54The Times(London), 29 March 1971, p.2. Also see editorial in New Nation(Singapore), 10 February 1972, p.8.

55 see Asia Research Bulletin, vo 1.1, No.8, J-anuary 197 2, p. 56 5.

5611 Radio Moscow 11 , reprinted in The Straits Times, 20 January, 1972, p.S.

249

57 influence as the retreated US power. They believed that the

US was an outgoing power and the Soviet Union incoming power, 1,--

and unlike China the Soviet Union had no links with the

domestic communist movements. Furthermore there was no 'overseas

RUssian' problem to complicate domestic politics or cause an

immediate threat. In that sense links with the Soviet Union

had been considered less risky gamble than with the PRc. 58

The developments in Cambodia in early 1970, hov:ever,

added a new dimension to Singapore's attitude towards the Soviet

Union. In March this ye~r Lon Nol overthrew President Sihanouk,

a pro-US military general, to the discomfiture of the Soviet

Union.

Between the late 1971 and April 1975, the Soviet attitude

to ASEAN remained unchanged. It still accused ASE~~ of being

associated with Washington, while at the same time giving half-

hearted praise to any moves that would disadvantage the Western

59 powers.

The events in Indochina since late 1978, had, however,

created a tense situation in Southeast Asia. The growing Soviet

involvement in Indochina, especially in SRV, alarmed Singapore

and other ASEAN countries. The divergence of perceptions

57Bilveer Singh, Soviet Relations with ASEAN 1967-88 (Singapore: National University of Singapore, 1989), p.39.-

58Ibid. 59Ibid.

250

represented in it was bound to have still adverse impact on

Soviet Union's relations with individual ASEAN countries.

In view of growing tension between Vietnam and Kampuchea

on the one hand and between Vietnam and the PRC on the other,

simultaneously with the increasing involvement of the Soviet

Union, Singapore and other ASEAN states began a spate of acti-

vities highlighting the tense and uncertain state of affairs

j .. n the region.

The Vietnamese invasion of Kamnurchea and the forcj_ble

ousting of Pol Pot-led Khmer Rouge government in Phnom Pen/,

shocked Singapore. Singapore accused the Soviet Union for

creating instability in the region. It also levelled accusations

against the Soviet Union for supporting diplomatically, militarily,

and economically, Hanoi's expansionist shcemes in Southeast

Asia. 6 0

eM-The Vietnam occupation of Kampuchea with ,the political

t and military support of the Soviet Union had clearly placed

Singapore and Moscow on different sides of the fence. Relations

between the two countries had deteriorated sharply. This was

largely the result of ASEAN diplomatic initiative in the inter-

national arena in which the former accused both the SRV and the

60 See s. Rajaratnam's speech at a Mass Rally on the occasion of the 25th Anniversary of the People's Action Party at the National Theatre(Singapore) on 20 January 1981. See Singapore Government Press Release(Singapore:Ministry of Culture, Information Division, 1981), Ref.No.092/81-0l/20. Also see The Straits Times, 10 January 1981.

2 5'.

USSR of being the main causes of the Kampuchean crisis. 61

A senior minister of state for foreign affairs, s.

Dhanabalan, declared on 20 March 1980 that Singapore would

hot service Soviet naval vessels or military planes. He

declared: 11 A few Soviet naval auxiliary ships carne here for

repairs some time ago.

kind of assistance, not

Certainly we would not consider that

62 now".

He also said that Singapore would not allow the Soviets

to 11 land their planes, refuel or fly over our air space on

flights to Indo-China 11• He further added that while "Singapore

may not be in a position to (materially) sup ·lort the res istence

movement in Indochina, we do not want to make it easy for the

63 Soviets to give support to those they are backing~

While Singapore thought that both the Soviet Union and

China were dangerous, it considered the Soviets, working thr-ough

Vietnam, as the more imminent threat. According to Dhambalan,

11 It is foolish to forget what the long-term interest of comrnunis·t

philosophy is. It just happens that at this juncture, we are

on the same side as China for our own reasons". 64

61straits Times(Singapore), 14 November 1979, p.12.

62see Asian Recorder, April 29 - May 5, 1980, p.15434.

25:1.

Thus the necessity for economic cooperation and

assistance providedby the United States, a form of miljtary

security assured by the Five-Power-Defense Group and Singapore's

relations with ASEAN on the one hand and the role of Soviet

Union during Kampuchean crisis on the other made it difficult

for Singapore leaders to maintain a b~lanced relationship with

the Soviet Union.

~opomic Cooperation

Despite its political differences, however, Singapore

enjoyed an active trade relations with the Soviet Union.· This

could be seen from the table. (table 3). 11hile Singapore • s

small size, precluded it from being a major Soviet area of

ingerest, the analysis of the above data showed that the ·trade

grew from a total turnover of S $ 164.50 million in 1969 to

S $ 262.1 million in 1974. 65 As in the case of Singapore's

trade relations with other countries imports from the Soviet

Union overshadowed exports from Singapore. Import over export

for 1969 decreased from s $ 35.43 million to S $ 25.7 :nlllion

ih 1974. While exports over imports increased from S $ 129.07

million in 1969 to S$ 236.4 million in 1974.

65Figures of trade between Singa:_->ore and Soviet Union were not given after 1974 in any primary source material of Singapore.

Table 3

Singapore's Trade with Soviet Union, 1968-1980 ( S $ million)

.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-. Year

-1968

1969

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

Imports

35.43

32.4

32.2

24.0

21.6

25.7

Exports

129.07

142.4

115.6

101.5

176.1

236.4

Total Trade

164.50

174.8

147.8

125.5

197.7

262.1

%Singapore's Total Trade

1.5

1.4

1.1

0.8

0.9

0.8

.-.-,-.-~---.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-

Source: Singapore, Singapore Facts and Pictures, A Ministry of Culture Publication, & Department of Statistics Singapore.

254

The trade agreernen·t signed by the two countries in April

1966 had obliged the Soviets to purchase Singapore-manufact'Jred

goods to the value of fifty percent of their profit made on

their exports to Singapore. Moscow was also required by

Singapore to keep on fixed deposits in Singapore banks equal to

;fitty to seventyfive percent of these proceeds. 66

Prior to 1970 Singapore was not producing sufficient

varieties of goods to interest the consumer market in the Soviet

Union. The main commodity in Singapore's exports to the Soviet

Union had been rubber. Later Singapore had started selling

clothing and shoes to the Soviet Union. Singapore was working

towards developing a large volume of trade in low cost, high-

skill production in return for food and heavy industrial products~

Although the Soviet Union accounted for a minor share in

67 Singapore's trade, it regarded Singapore as an important

regional commercial centre and held exhibitions of the Soviet

Trade Organization the~e in 1968 and 1971. These exhibitions

were displays of machines tools, cars, tractors, "hidrofoil

dauncher", consumable, clothings, and other evidences of the

Soviet Union's ability to provide competitive products and

manufacturing expertize ·to the Afro-As ian bloc. Singapore's

commercial ties with the Soviet Union were of benefit to other

66with the establishment of the Soviet Trade Commission in 1966, Singapore was able to begin direct trade relations with the Soviet Union. Earlier all of Singapore's sales of rubber were processed through London. Straits Times, 29 July 1966, p.3.

67The Soviet Union's share in Singapore's total trade in 1972 was 0.8 percent only. See the table 3.

ASEAN countries as we=ll. For instance, it generated hope

for the Philippines Chamber of Commerce to use Singapore as a

"clearing house" for Philippines' barter trade with the

68 socialist countries.

On its part, Singapore hoped to expand its trade relations

with the Soviet Union in order to regain losses in entrepot

trade wi·th Indonesia and Malaysia which had resulted from the

efforts of these countries to eliminate the Republic as a

middleman.

Singapore and Australi~

Singapore's strat~egies ·towards l\1Jstr.Jlia Cancl oU1~T

Five Power Defense Arrangement partners - New Zealand, M~laysia

and Britain) '>~~ere, in their own ways, of an enduring and resi-

lient nature. Singapore interacted with these nations in inter-

national organizations and within the commonwealth associa·t.ion.

Moreover, it relied heavily on this group for security, ecJnomic

and political sustenance, and support. Nevertheless, rnut~al

dependence, economic reliance, political support, and other

variables shifted in emphasis and importance according to the

nature of Singapore's national interests.

Singapore's association with Australia was marked not

only by official relations through the Commonwealth but also

by commercial ties. The most visible facet of the connection

67see "Manila bid for Red Trade", Straits Times, 28 August 1970, p.4.

between Singa:lore and Australia prior to 1965 was the

stationing of Australian troops there. This represented

Australia's role in ·the framework of Five Power Defense A1jree-

ment to provide security to Singapore and Malaysia. Sinc8

Singapore's independence in 1965 and the end of Indonesian

C0nfrontation in 1966, Lhe Australian Military presence h:1d

been reduced, at least in number of troops in the garri~on,

but it remained a political question of great importance to

the Singapore government.

Security ' .. Considerations

Singapore-Australian interaction depended upon hmv

Australia resolved its complex problem o£ \vhether to become an

involved, committed and participating power in the affairs of

Asia, or to retain its present minimal role. Before Vclorld \'-Tar

II economic, security, and political links with Britain •do.re the

bases for much of Australia's foreign policy. The signing of

the ANZUS Treaty of 1951 marked the recognition in Australia

that the United States coulu better guarantee Australian security

than Britain. In the early 1950s Australi~~ interests began to

shift. In 1955, Australia helped establish SEATS and sen·t: units

to serve in the Commonwealth.strategic reserve in Malaya. These

commitments were the result of the decision of Sir Robert Henzier

to pursue a policy of forward defense.69

69A brief analysis of Australia's defense strateg-.r may be found in Joseph F. Flader, Prospects f0r Continuation of_~E~~ lia'~ Forward Defense Strategy(Arlington, Va: Institute for Defence Analysis, October 1969), pp.4-6.

The central theme of this strategy was that the major

threat to Australia emanated from communism and that in ord.er

to guarantee cooperation and support needed to counter i t.r

Australia would have to continue its security relationship

with the United Kingdom and New Zealand in Malaya and support

the defense efforts of its powerful friends in the ANZUS ':':i:·eaty.

The forward defense concept endured throughout the

period of the Emergency (1948-60). It also remained in place

through the period of Indonesian confrontation when Austr<Jlia

deployed combat troops in Malaya and Bronec. The British

decision to withdraw from their defence commitments to 3j_n<;rapo.re

and Malaysia announced in 1967 and the subsequent realization

in Canberra that Australia was expected to take up the Bri ·tish

responsibility in the area forced a sort of rethinking of

Australia's foreign and defense policies vis-a-vis Singaporf::! and

Malaysia.

For the discussion of foreign policy issues, it would be

sufficient to indicate that in February 1969 Prime Minister of

Australia stated that Australian force would be maintained in

Singapore/Malaysia after the British left in 1971, that t:1ere

would be no terminal date in the Australian commitment, and

that Australia would not participate in any formal defence treaty

scheme but would operate within a framework of "general unc'l.er­

standing".70

70see Australia, current Notes on International .a.~£airs, Vol.40, No.2, February 1969, pp.42-3.

He also indicated that Australia's defence policy was

in general support of its stated policy in Southeast As1a of

''promoting political stability and economic growth". 71

Singapore's relations with Australia since i'lorlo i;.far II

had been security-oriented and little public criticism of this

policy had occurred until 1967. Since 1967 pressure had been

brought to bear on the Australian government to cut or sig-nifi­

cantly reduce its spending in the· entire region of Soutll~~ust ,

Asia. Because of the increasing level of Australian investment

and trade activity in Singapore some form of military presence

had to be maintained in the Straits of Malacca area after 1972.

It was doubtful in any case whether the rejection of a

reduced military presence in Singapore by the Australian govern­

ment would drastically alter the non-ifiefence aspects of t.he

relationship which had been developing between the two countries

since 1965. Other aspects of the relationships, especially

rapidly growing trade ties, were slowly reducing the importance

of the defense partnership. Lee Kuan Yew had stated that ho

welcomed the Australian Military contribution to the Five-Power

Defense Group but halll been publicly non-committed on rumours of

Australian decision to de link itself from the defense group.

Personal relations between the leaders of the two ~ove~n-

ments were excellent and Lee Kuan Yew maintained an undi~;t.urbed

position regarding Australian dectsions

defence support to Sj_ngapore/Mal ays ir1.

Singapore and Australia: Economic Cooperation

Trade

Both Singapore and Austr<'3.1 ia had been working tOW<lrd

increased trade activities. Although trade balance had been

heavily in Australia's favour, the volume of annual trade

increased significantly, making Australia one of the mc-Jj or

trading partners of Singapore.

Australia had been a major trading partner of Sing,O:',')Or:e ..

In 1967, the total trade between Singapore and Australia t1..:;.c

been 269.8 S $ million which rose to 1333.3 S $ million

in 1980 (January/June). However, although two-wa.y trade

rose considerably from 3.~2, percent in 1967 to 4.5 percent in

1971, Australia's share of Singapore's global trade deci ined

from 3.4 percent in 1967 to 2.9 percent in 1979.

The i terns of trade between Singapore and Australia '(.Jere

mainly food and petroleum products. Singapore's major imports

from Australia were wheat, meat, fruit, and sugar. On the

other hand Singapore's exports to Australia were primarily p2t-

roleum products and a narrow range of manufacturing goods.,

Investments

Australia was not a major investor in Siggapore. l\.s

at December 1979, Australian investments in Singapore amounted

72 to 1. 7 percent of total foreign investments here. The ma5!1

72see the Speech given by Bernard Chen, Minister o.f: State for Defence on "Economic relations between Singapore and Au.str-a!i<: Speeches(A monthly collection of ministerial speeches, Singapore, 1980), vol.3, No.7, pp.89-92.

Table 4

Singapore's Trade with Australia 1968-1980

S $ l,Hllion)

2()0

.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-. Year 1m ports

1967 106.8

1968

1969 241.29

1970 340.5

1971 367.7

1972 385.9

1973 442.1

1974 570.0

1975 661.5

1976 578.0

1977 644.6

1978 597.5

1979 843.4

1980 Jan/ 503.4 June

Experts

'73.rJ

123.04

160.1

257.2

294.8

329.2

687.7

637.2

831.2

990.6

928.5

1149.5

829

I'oL'Il l'rade

364.33

500.6

624.9

680.7

771.3

1258.7

1298.7

1409·2

1635.2

1526.0

1992.9

1333.3

%of Sing '[Jo.re 's 'T'ota 1 Tr<'lde

3 r j ;~

4 .-~ 1

4. t)

4.3

3~6

3.6

4.,:1.

3rh

J.6

2 0 9

2 .. ?

.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-.-~~.-.-.-.

Source: Singapore, ;3ing~ore Facts and Pictures, A Minis·try of Culture Pu.blication and­Departrm:mt of Statistics, Singapore.

areas of investmen~were in the machine tools, automobile

and electric products industries.

Apart from trade and investment, one other aspect in

Singapore's relationship with Australia was technical aid~

Australia had been the donor of technical assistance to

Singapore. Assistance, provided principally under the Colo;nbo

Plan, had been mainly in the form of training awards, expperts

73 and equipment.

Between 1964 and 1980, Singapore received a total of

7 t! 391 undergraduate and 74 postgraduate training awards. The

award~ were mainly in the fields of engineering1. archi tee tu re,

medicine, veterinary science and land surveying, which heJ~€d

build up the core of professjonal manpower in Singapore. In

addition, a total of 538 training attachments were receiw1d.,

Within the same period, 123 Australian experts in Computer.

Science, medicine, engineering and air :'ollution were seni.~ t:o

Singapore to help in ad hoc projects. Aid in terms of equip-

75 ment from Australia amounted to S$ 1.9 million.

Thus the Australian contribution to the growth of ~>inga-

pore's economy was significant.

---------------·--·---

74Ibid.

75Ibid.