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Release No : 21/October 02-1/84/10/09

TRANSCRIPT OF THE PRIME MINISTER, MR. LEE KUAN YEW'S DISCUSSION WITH FIVE FOREIGN CORRESPONDENTS, RECORDED AT SBC ON 9 OCTOBER 1984

Michael

Richardson : Good evening.

On behalf of our panel, I would like to welcome the Prime

Minister of Singapore, Mr Lee Kuan Yew.

My name is Michael Richardson of "The Age" newspapers

in Melbourne and the "Sydney Morning Herald". With me

in the studio tonight to interview the Prime Minister are

four other foreign correspondents.

Kenneth

Whiting : I am Ken Whiting of the Associated Press.

Hans

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Heine : I am Hans Heine with the German Radio Network, ARD-

NDR.

Chris

Sherwell : My name is Chris Sherwell. I am from the "Financial

Times" of London.

Masaru

Matsuda : I am Masaru Matsuda from the "Nihon Keizai Shimbun",

Japan.

Richardson : Singapore has just finished celebrating 25 years of nation-

building. Political power is being transferred from older to

younger leaders. We would like to start our questions

tonight with one that interests many Singaporeans and

many people in Singapore: the date of the General

Elections widely expected for later this year.

Prime Minister, have you decided on a date for those

elections? When will you announce it, and will you be

lky/1984/lky1009.doc 3

unhappy if the polls do not result in another clean sweep

for the ruling People's Action Party?

Prime Minister : I have not settled the date. I have a tentative date, but I am

watching to see how the American economy goes. If all

goes well as it looks like, it will be held in the next four,

five months, before Chinese New Year.

Richardson : Will you be unhappy if the polls don't result in another

clean sweep for the PAP?

PM : We fight to win. At the same time that tells us something

when we don't win, as we did not in Anson. So happiness

is a subjective frame of mind. This is a test and out of the

test we gain useful feedback and information, like the way

they voted the last time in Radin Mas and in Telok Blangah

where we did not have a strong candidates but they were

strong, favourable constituencies. A signal to us - a

changing electorate; a younger more intelligent, more

educated, more demanding electorate not interested in our

having a balancing slate of Chinese, Indians, Malays.

lky/1984/lky1009.doc 4

They are just saying, "Look, this man you are putting is

going to be my MP. I don't think he measures up. I am not

voting for him."

So the way the voting goes tells us something. And it

could well be. As in the case of Anson, the way the voting

went, we gained something. So being unhappy at the result

of Anson didn't mean we lost by it.

Whiting : Prime Minister, much publicity has been given recently to

the name of your son as a candidate for Parliament. Are you

pleased to see him enter politics and would you like to see

him become Prime Minister one day?

PM : Ah! It's been on my mind for many years. He has the

attributes. He also has the disadvantage of being my son

because it will always be said that he was favoured and

he'll always be measured against his father. I think he

ought to be big enough to be measured in his own right. I

was pleased that the younger Ministers decided to

nominate him because it showed they did not lack self-

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confidence. He was so obvious a choice that not to have

chosen him would have told me something about the

younger Ministers. Perhaps they did not want to embarrass

me. Perhaps they also felt more comfortable without

younger, bright, strong young men. But that they chosen

him proved to me that they were not afraid of competition,

that they were out to incorporate the best in the team and

that pleased me.

Whether he will make it? First, he's got to win the

elections and he has got to prove that he is equal to the job

first of being a minister. Whether he will be Prime

Minister that's not up to me. He's got to convince the

other MPs because the Prime Minister must command the

confidence of the majority of the Members of Parliament.

And he's got some three strong men older than him with

more experience and already entrenched. He'll find his

level.

Sherwell : Prime Minister, you are not at all worried, are you,

following up this question about whether you son's entry

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into politics inevitably raises the question of whether you

are really satisfied with the second generation leadership,

which is now after all very well established and, on top of

this, that it runs the risk that you could be accused of trying

to create a dynasty? Do these suggestions worry you at

all?

PM : Not really. My methods of running the government, my

measurements for getting people to be ministers, to be

tested for leadership they are well-known. I don't think it's

a slight on the other ministers that they choose to field my

son. I think it is a tribute to their objectivity and their

willingness to incorporate the best, even if it is, or could

be, a challenge to them.

As for forming a dynasty, well, I don't need to seek

fulfilment vicariously. I've reached a point in life where, if

given a choice, I'd like my accounts to be closed with me

and the judgement made on what I have done. But my

son's entry into politics means a new chapter, not

connected with me but not altogether unconnected because

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it could be said that I influenced his thinking, the cast or

shape of his political philosophy, and so his account may

reflect either creditably or discreditably on me. So, well,

it's something I live with, too, as a father.

Matsuda : Prime Minister, you mentioned your time for retirement

will come. Is there a target date for that and what will

occupy you after you leave the Prime Minister's Office?

PM : Well, I've mentioned American corporation is making 65 a

good retirement age. I think that's a good target date.

What will I do? I suppose something connected with

politics but in a less active executive role.

Heine : Prime Minister, would you eventually consider election for

President in case the Constitution would be amended

accordingly?

PM : I would not rule it out, but I would not make a firm

commitment that that is a job that I will undertake. Four

years, five years is a long time and I would imagine that to

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run the job in will take several years because a new

relationship has to be created. The amendments will have

to be done after the next elections or should be carefully

thought out. The officials are thinking through all the

problems. The Auditor-General, the Accountant-General

have to work out who has to inform the President's

Committee or Secretariat what assets are being committed

or what debts are being incurred.

And we don't want to upset the present executive powers

of the Prime Minister. It is only when he encroaches on

reserves that he's got to get the President's concurrence.

That means sensible, practical relations so that the system

can continue as it is.

I would like to be Prime Minister whilst that system is first

implemented. So I can tell the President, who I hope will

be someone who knows me and will know that I am not

raiding the reserves to squander it, that these guidelines

will have to be interpreted sensibly. Then after such a

period, he'll have to serve out his term, which I think

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should be more than the term of the Prime Minister and his

Cabinet, more than one Parliamentary term so that they do

not coincide. There will be a sitting President in the

middle of his office when a Prime Minister and his Cabinet

have resigned and are re-elected.

Richardson : Prime Minister, do you foresee the development of a two-

party parliamentary system in Singapore? Do you think

that would be desirable or would you prefer to see a debate

and dissent generated within and channelled through the

ruling PAP and its grassroots organisations?

PM : The way to bring it about if it were wise to do so would be

to have the People's Action Party divide into two wings.

Then both wings are committed to certain basic and

fundamental rocks on which the society will rest and can

argue about peripherals - whether more should not be spent

for social security or a more liberal view taken - liberal

with a big 'L' - of how we spend our money in tempering

the harshness of meritocracy and open competition,

whether we don't give a little more padding to those who

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can't quite make it to the middle ranges or income brackets.

That's theoretically ideal. Then you can switch sides in the

electorate field - well, all right, we've got to change

without prejudicing the whole system. In practice, it is

extremely bold, radical.

And I don't suppose I will do it because it's not wise to ask

a segment of the party, say, "Look, you go form the

opposition. Get out of office." I don't know if my

successors will. I think it's an unnecessary hazard because

there are enough schisms in the society as it is. It's not

something you can cement over - differences of race,

Chinese, Malays, Indians, and different kinds of Chinese,

and different kinds of Indians, and different kinds of

Malays. They are real. They are abiding. And we've done

a lot to make it more uniform or less stark a contrast. But if

you are discerning and you go to a housing estate, they all

look the same, but you can see that they lead slightly

different lives.

lky/1984/lky1009.doc 11

You would find in every estate now, major estate, a Malay

mosque and the amount of not just religion but social

activity that resolves around the mosque because it has

libraries and reading rooms and so on. It's quite

remarkable. It's something which we have debated often

amongst ourselves with our own Malay MPs. It is wise to

have all these extra facilities in the mosque because it

means that the Malays detach themselves from the

community centre and make the mosque their own special

community centre. Then you have more segregation and

either they want or the non-Malays want.

I'll give a simple illustration to show up their difficulties.

We used to have certain constituencies where the Malays

were the majority of the voters. Now we face a

fundamental problem when we resettle them. Do we

rebuild these areas and rehouse Malays in these areas so

that they will still be the majority, or do we expose them

and, like the Chinese and Indians, ballot for their

neighbours?

lky/1984/lky1009.doc 12

Well, the Malay MPs thought it over. So did we. We

decided no. In the long term, it's better that we mix

everybody up. So we have. No constituency has more

than 30% Malays as the ceiling. The result will

progressively be, or already I suspect is, a tremendous

pressure on us to find Malay candidates who can fight

against a Chinese candidate or an Indian candidate who is

better qualified, more education, more energy, more

whatever, and still win.

That's quite a problem because the electorate has changed.

A young electorate is no longer interested about the party

having a balanced slate. They've never faced riotous

situation where people run amok and butcher, kill, maim

each other because they are berserk. Now there's no such

situation.

So with these kind of deep, underlying, almost primeval

urges, I don't really see a Whig-Tory kind of tossing power

back and forth.

lky/1984/lky1009.doc 13

Sherwell : Prime Minister, the Singapore economy is expected to

grow by about 9% in real terms this year, helped somewhat

by the recovery in the United States, of course, and also by

the domestic public sector's construction effort in

particular. But there also seems to me some gloom about

the prospects in the properly market. Retailing sectors are

quite depressed. Some of the country's blue-chip

companies, including some government-controlled ones,

are reporting disappointing results. And even some

bankers are saying that times are getting harder. I'd like to

ask you what you see as the main domestic engine of

economic growth for Singapore over the rest of the

decade?

PM : Well, that depends on how the United States recovery

goes. If it is sustained, and you have 3% or 3 1/2% next

year, or even 2 1/2% next year, and continues in that

steady fashion, and the Europeans pick up and the

Japanese provide more of a lift, I think we will gradually

shift into higher value-added industries. They call it high-

tech, but it's really just servicing high-tech industries,

lky/1984/lky1009.doc 14

computer software, computer peripherals, the manufacture

of computer parts. But still very much what it is - the

spread between manufacturing and servicing.

But by the next decade, if the trend continues, then with

the information age, we should be moving more into

servicing, which would make me a lot more comfortable.

We haven't got a large population, and we would be

maximising on our small population base by having them

more and more in servicing, financial servicing - banks,

insurance companies, credit cards, telecommunications,

information generally. I think as fibre optics and all these

data banks spread around the world, and everybody has his

own personal computer and you can switch your set on and

link up with databases in America, and , and ,

we should become more and more a regional information

centre.

In the information age, we have a clear advantage because

lky/1984/lky1009.doc 15

we have always concentrated on communications. We

have good lines already established worldwide and

regionally, and it's not subject to protectionist measures.

So it's a great deal more comfortable than what it is now

because it means worrying about what happens with the

GSP in the United States. Has it extended another 8 1/2

years and are we disqualified? If so, when? Do we reach

a $9,000 per capita? Is it fair to us that measurement, and

so on ?

Richardson : Prime Minister, can Singapore remain an open and

internationally competitive economy with such a strong

dollar and high wage and other costs? I think that certainly

Australian businessmen here have some doubts on that

score, and I believe that other business groups in Singapore

do as well?

PM : No, I don't think you are right. I think the Australians are

worried because they take their Australian experience with

them when they interpret these happenings in Singapore.

A strong dollar is not too strong. It's weaker than the US

lky/1984/lky1009.doc 16

dollar. It's always lagging behind. I think it's 2.16 to the

US dollar. It used to be nearly $2.

High wages? I don't really think they are high. We settled

last year for the NWC, National Wages Council,

recommendation which was, I think, 3 1/2-7% range. And

the overall settlement across the board was 11 1/2% over

and above the top. So 4% above the top.

This year the settlement was $27 plus 4-8%, and up till the

end of last month, end September, about 15-20% settled

above that range. There are open settlements between

managements and workers and unions. Slightly over 50%

settled at the top end of the range, 6-8%, and the rest

settled in the middle ranges. Almost a small minority of

about less than 10% settled at the lower ends of the range -

shipbuilding, the ones not doing well.

So there's no evidence that this is so. And it's very

manifest when you look at the labour figures. Jobs created

lky/1984/lky1009.doc 17

this year, second quarter, increased by 5% over the first

quarter, and I think about 3, 4% over the same quarter last

year, jobs lost, retrenchment and jobs created was about

6,000. Jobs lost about a 1,000 and 6,000 has taken into

account the jobs lost 1,000. So it's 6,000 over and above

the 1,000. Unemployment figures went down, I think, by a

few hundreds from about 7,000 to 6,400, 6,300.

So the signals that we get from the market - demand for

labour, jobs that are going settlement of wage rates - show

that we are competitive. That is not so.

And, indeed, the American Business Council put up a

submission in August - they are all members of the

National Productivity Council - asking the EDB, our

Economic Development Board, not to canvas or recruit any

more new companies because they say, "Look, you haven't

got the workers. We need workers to expand. This is a

year of recovery. And if you bring in more companies who

call themselves high-tech but, in fact, are doing simple

assembling jobs of computer peripherals and very simple

lky/1984/lky1009.doc 18

computer programming, they are just competing in the

labour market." So they are very different signals.

I think the Australian tends to interpret high wage rates

with what's happened in where high wage rates

are not matched by increased productivity and

competitiveness in selling his products and, therefore,

every time he sees a wage rise of 11% his heart is in his

mouth. But where our productivity is going up by 7, 8% -

last year it was about 6, this year may be 7 - and we are

competitive, I think it's wiser to move the wages nearer

what the market can easily carry, then keep it down, and

have an explosion two, three years down the road. Then

you upset the whole stable relationship between employer,

management and government.

We've got confidence between employers, management

and unions and the government. The figures are there. We

can study it every year, reach broad agreement on what is

feasible, and we allow a bigger and bigger range for

employers to decide with their workers at which end of the

lky/1984/lky1009.doc 19

range they ought to be. We have suggested we ought to

phase ourselves out. The government should phase itself

apart from the Americans, who have a very robust attitude

and prefer bilateral bargaining, and a good company would

pay above the market rate to get the best workers, all the

others are against it. They want the government involved

so that the weight of the government is behind the NWC

recommendations. So the facts do not support that point of

view.

Matsuda : Prime Minister, you just mentioned so-called high-tech

companies, which aren't really high-tech, ...

PM : They are not.

Matsuda : ... are coming into Singapore. Then could I ask what does

high-tech mean to Singapore? Does Singapore really have

a high-tech future?

PM : Well, we've started this Kent Ridge estate and there are a

few, I suppose, to link up with the university doing

lky/1984/lky1009.doc 20

biotechnology research. A few of our Singaporeans who

have gone abroad to Canada and America have come back

to help us set up these units. They are doing research in

America and in Canada. And they tell us that in certain

peripheral areas there is a chance we can make a

breakthrough. But I must not discourage our enthusiasts in

the Economic Development Board and Science and

Engineering faculties where I think sheer mass of brain

power in numbers and quality ... you face a population of

250 million, the whole of - extremely

bright, particularly in the areas that they have chosen for

themselves: electronics, communications, computers,

biotechnology. Maybe the Japanese have given them some

competition in computers. They haven't yet in

biotechnology.

So really what we can hope to do is to keep abreast with

what they are doing and, perhaps, service them at the

peripherals or little niches which are left open. If the

lky/1984/lky1009.doc 21

Europeans can't muscle in on computers, I don't see how

we can.

Sherwell : Prime Minister, I'd like to turn to the banking centre if I

may. There have been three major pieces of legislation

already this year toughening the considerable powers of the

Monetary Authority still further. And in the past year or so

we've seen a finance company close down, several billion

and commodity dealers closed down and only recently a

merchant bank. At the same time, some commercial banks

have been ordered to make large debt provisions. And the

overall impression is that the government seems to be

battening down the hatches at the very time that New

York, London, Tokyo, Sydney are apparently opening

doors and liberalising. Shouldn't Singapore be doing the

same thing?

PM : I am not sure first, if that's what New York, London,

Frankfurt or Tokyo is doing. I thing that's what New York

appears to be doing. They are not making debt provisions

for what their bankers must know - very, very long-term

lky/1984/lky1009.doc 22

loans ... sometimes 200% their capitalisation value. So

they've got to keep the road show going on the road and

reschedule, but I believe the Germans and the Japanese do

make substantial provisions for reserves. I think the

British, too, are conservative.

So the analysis of the people outside the collective cartel

that has to keep on lending is that there will be a

divergence of interests in a few years because those banks

by Germans, Japanese, maybe British, who have made

substantial provisions for these loans, troublesome loans,

will ie less willing to risk fresh funds.

Indeed the Basle Concordat has an offshoot called the

(Cook) Committee, where bank regulators and supervisors

meet and discuss what should be done, and the MAS

representative attends these meetings. And the last one in

Rome, I read the report, urging stricter supervision and

urging banks, the big multinationals, big money banks, not

to set up branches where supervision is lacking or

inadequate. They are recommending that no subsidiaries

lky/1984/lky1009.doc 23

or branches should be set up in centres which are not

adequately supervised. In other words, they are signalling

to us, supervise. And we've had no complaints from any

head office. I don't know about the people on-the-spot.

You know about the branches in Lugano where they went

trading on the foreign exchange markets without notice and

vast sums of money were lost.

But I believe that not only have we taken measures which

were necessary, we have taken them in time before

irretrievable damage has been done to the system. And,

fortunately, I think no one, no single bank or indeed

finance company, has been unable to meet the new

provisions required. I think there are higher liquidity and

reserve requirements, limits on lending to any single

borrower or group of borrowers, limits on investments,

investment limits on real estate, and so on.

The amendments affect only Domestic Banking Units

(DBU), ie S$ transactions. Asia Currency Units (ACUs)

or the Asian Dollar do not have reserve requirements or

lky/1984/lky1009.doc 24

other prudential regulations to meet. The banks are

therefore completely at liberty to deal in ACUs (Asian $)

as they were before. Of course depositors of ACUs will

not be as protected as depositors of S$. They receive a

higher rate of interest in line with rates in the Euro-market.

There is no opportunity cost for reserve requirements and

liquidity ratios which are required of S$ deposits.

Therefore the first charge on the assets of any bank is for

DBU (S$) deposits.

The only adjustment time we had to concede was from one

year to two years for those who had lent 60% of their

capital assets to one borrower or a group of borrowers to

get down to 30%. We are giving them two years instead of

one year. They have asked for two years.

And what is interesting is no bank, either Singaporean or

foreign-owned, made any representation to the MAS or to

the Minister of Finance during the period between first

reading and second reading. So nobody thought that they

were wrong in principle. Whatever they may have desired

lky/1984/lky1009.doc 25

privately, nobody came out and said, "Look, these

provisions are wrong. They will stifle the growth of the

banking industry," and so on. In fact, they all know that

this is wise. If we don't do that we will have the sort of

problems which have plagued Hong Kong.

Last year, September '83, one Hang Lung Bank had to be

taken over by the government, nationalised, rescued. And

then there was a deposit-taking company that went bankrupt,

couldn't meet its liabilities.

I don't think we want to wait for that situation to develop.

Sherwell : You are not concerned at all that the image will be gained

that there is the heavy hand of the government that works

with the regulation and that this might impair the chances

of Singapore achieving its ambition as an international

financial centre.

PM : No. I think that may have been the view of bankers

previous to the debt crisis, when I was told by many lky/1984/lky1009.doc 26

bankers that it's much better to do business in Luxembourg

than in Frankfurt because "they let us do what we like and

all this molly-coddling of so much in the reserves loses us

so much opportunity costs."

But the same bankers who said all those things have got

into trouble with their Luxembourg branches, and the mood

has changed. And I believe that the Basle Concordat, the

(Cook) Committee has really articulated their present mood

that banks which are not properly regulated or whose

branches are not properly regulated, set offshore, are in

jeopardy, or in more jeopardy than if you are in a centre

which is properly regulated.

Sherwell : You alluded a moment ago to the international debt

problem and the aspect of that which has potentially more

severe implications for Singapore is in the Philippines.

How has that problem affected Singapore exactly?

PM : Well, foreign and Singapore banks, but mainly foreign

banks, have lent a total of S$7 billion. I suppose many of

lky/1984/lky1009.doc 27

them are now meeting in New York to discuss how they

are going collectively with other banks around the world,

probably 1,500 banks, to raise $1 1/2 billion for the next

year. Obviously the capital is not going to be paid for

quite some time, and like everybody else, we hope the

interest will be paid. But for the Singapore banks, we have

asked them to make provisions for the contingency which

we hope will not arise. But it's already done, so we've got

to live with the problems as they are.

lky/1984/lky1009.doc 28

Heine : Sir, recently there has been strong emphasis on defence in

the media in Singapore as well as in speeches - total

defence, civil defence, or what kind of defence. Might that

lead to the conclusion that you foresee any threat to the

security of Singapore and if yes, what kind of threat would

that be?

PM : Well, our biggest threat in Singapore is that any threat will

come from someone bigger than us. It must be in the

nature of our situation, in the nature of our circumstances.

And the greatest disservice we can do ourselves is to be

terrified and panic-stricken. We have a national service

defence force based on a civilian population. If the civilian

population is faint-hearted and is intimidated as they see

forces mobilising, huge, massive forces, then the battle is

lost before any shot is fired.

A younger generation is coming of age. My generation,

we've faced Japanese Occupation, conquest, hardships,

brutalities. We've gone through quite a tumultuous period

lky/1984/lky1009.doc 29

of human history and we are accustomed to staking our

lives. The younger generation now in their 30s have had

relatively quiet and placid a life. Life has meant

growth over the last 15 years. A few hiccups in 1973-74

oil crisis, 1979, second oil crisis, so growth rates went

down. But on the whole, every year meant a better life.

I think they've got to face up to the very real possibility

that one day somebody is going to take their knuckles, put

knuckle-dusters on and say, "You give me, or else." And I

think Singaporeans will just have to take a deep breath and

say, "Well, or else, let's see what we can do." A civil

defence, a total defence is to involve the civilian population

whose morale - fathers and mothers, brothers and sisters -

affects the morale of sons, brothers.

I am not sure whether we will succeed in this way. But at

least, theoretically, intellectually, we have posed the

problem to them, that whatever the threat it's going to be

bigger than us. So let's live with that, and let's not get

terrified.

lky/1984/lky1009.doc 30

Richardson : Prime Minister, do you foresee increasing threats in the

years ahead to ASEAN member countries? What kinds of

threats do you see coming up, and should they be met

collectively as well as individually?

PM : I think we ought to wait and see how the Cambodian issue

is resolved because that will decide the balance of forces

between the Communist group of countries and the non-

Communist group of countries. If it is resolved with a total

Vietnamese withdrawal and the re-installation of a

Cambodian government, not beholden to either Vietnam or

to China or to the Soviet Union, then I can foresee a period

of relative stability in which the non-Communist groups

can together withstand the pressures of the Communist

group of countries.

If it is resolved unfavourably, in that there is a clear benefit

to use arms supplied by the Soviet Union to extend one's

territory, then enormous problems arise because in

lky/1984/lky1009.doc 31

expectation of such further moves, shifts will be made in

national positions. So ASEAN is agreed that there should

be a withdrawal, and there should be elections to decide

who is to govern Cambodia. In other words, that there

should be no benefit to any one by exploiting an alliance

with a super-power and supplies of arms and military aid

from that super-power to expand one's territory.

Of course, there are very strong desires on the part of

several ASEAN countries not to want to weaken Vietnam

because they see a useful role for Vietnam in this balancing

between Communist powers. And it's a viewpoint which

we take seriously. I think there is merit in that viewpoint.

But there must be a withdrawal.

lky/1984/lky1009.doc 32

Matsuda : Prime Minister, in connection with the Cambodian issue,

after Australia's inconclusive effort, do you think Japan can

be a useful mediator between ASEAN and Hanoi in

resolving the issue?

PM : If you ask my personal opinion, I'd say yes, because Japan

has got more to give Vietnam than Australia. And

Vietnamese are not slow-witted. But if you ask me what

are the chances of a successful mediation in the immediate

future, I'd say not very much because the Vietnamese are

not yet ready.

They have thrown the dice. They had this treaty of

friendship and co-operation. They had the arms and they

thought one swift sweep into Cambodia and it's all over.

Well, they are wrong. It's not over. They are landed with

an intractable problem. But they are very old men who

have gone through many crisis and have not yielded lightly.

They are all in their 70s. The first three leaders in Vietnam

are unlikely to admit that they are wrong very quickly.

lky/1984/lky1009.doc 33

And we'll have to wait and be patient.

Sherwell : Prime Minister, do you think the Vietnamese can possibly

do a deal over Kampuchea with the Kampuchean

resistance and thus with the ASEAN countries without

being sure at the same time that the Khmer Rouge will not

return and thus unless there's a deal with China

simultaneously?

PM : The terms for a settlement which have been agreed upon in

the United Nations does offer all of us such a solution. I

am not saying that it is going to be the ideal that the

Vietnamese want. They want a solution which takes the

status quo as it is and the withdrawal as and when they

think it's necessary, 5 to 10 years after peace and the

dismantling of all the resistance forces. The Chinese have

their views as to what should be a good settlement.

But in between those two extreme viewpoints there is a

lky/1984/lky1009.doc 34

large body of opinion in the United Nations that believes

the Cambodian people should be allowed to decide their

future. A situation could be created in which, reluctantly,

both the Vietnamese and the Chinese and the Soviet

Union, I suppose, will think it is worthwhile letting the

Cambodian people decide. And if the Cambodian people

decide I don't see how Pol Pot will come back.

Heine : Sir, may I come back to Asean for just a minute. Are you

always satisfied with the pace of progress with political

and economic cooperation within Asean?

PM : I have been asked that question time and time again. You

know, If I were a complacent, easily satisfied person, we

would have made very little progress. But at the same

time, I have learned over the years that if we are going to

make progress in Asean we will have to make it at the pace

which is most comfortable to the majority.

That means we must accept that we will make more

political progress does not require domestic concessions -

lky/1984/lky1009.doc 35

a change in five-year national development plans. It just

means coordinating our foreign policy and bargaining with

the developed group of countries, either America, EEC or

Japan, in a united front. Whereas actual economic

cooperation means tearing down tariff barriers, having

freer flow of goods and services and freer flow of capital

between countries in Asean and that will take some time.

Richardson : Prime Minister, the United States says that continued,

unhampered access for its forces to military facilities in the

Philippines, and the maintenance of regional security

arrangements including the ANZUS Treaty between the

United States, Australia and , are essential.

Do you think that a satisfactory balance of power in

Southeast Asia can be maintained without a substantial US

presence, which is underpinned by these arrangements?

PM : No. The United States presence is the only counterweight

to a Soviet presence. If there is no American presence in

East and Southeast Asia, we have a very different world.

lky/1984/lky1009.doc 36

Ricardson : Do you see a danger from the developments in the

Philippines, the gains apparently being made by the

insurgents and political uncertainties ...... that access that

the United States says is essential, maybe restricted or

even denied in future?

PM : That the United States Administration has seen fit to have a

senior official - I think Mr Armitage - express his fears

over the growth of the NPA, New People's Army, and the

communists in the Philippines openly discuss the

possibility of a communist take-over within ten years is, I

think, significant and worrisome. They must have reasons.

I mean they are thinking people. They are not alarmists.

By the time they sound this alarm the situation must be

grave enough for the alarm to have been sounded. And I

think it will have grave repercussions on the whole region.

Whiting : Prime Minister, based on current trends, what kind of

nation do you imagine Singapore is likely to be when it

celebrates 35 years of nation-building, ten years from now?

lky/1984/lky1009.doc 37

PM : Given peace, no major world recession or depression,

growth rates of say 4 to 8%, by ten years we would have

been graduated for GSP reasons. I think we have to accept

that. We should be more in the service sector. We should

be a growing information centre or a part of the

information age network of centres in the world, a standard

of living which should be able to sustain reasonable

cultural levels, reasonable cultural activities. If we could

enjoy say a standard of life of, let's say, Ireland or Britain

of today and we won't be able to compare with them in

their cultural manifestations - orchestras, ballet and the

arts. But there will be more of it.

I would think our major acute problems of want, privation,

bad housing, malnutrition, that's already over. The sub-

acute ones of inadequate care for the old and the aged -

inadequate institutional care because more and more

families find it very irksome to look after their old because

wives are working and not enough free hands in the

household. All that could improve.

lky/1984/lky1009.doc 38

On the whole, I'd say a more gracious, a less pressured

society. It should have already arrived. It shouldn't be

anxious about whether it's going to arrive or not. We

should by then have established our educational system

and got everybody educated who can be educated, and

establish it so well that for the next 10, 15 years people

will keep on being educated that there should be no fall-

back.

lky/1984/lky1009.doc 39

Sherwell : Prime Minister, Singapore's great economic achievements,

I think, have rightly won great acclaim abroad. One of the

criticisms I've heard most often made of Singapore, of the

education system and perhaps more widely, the media or

the cultural environment, is that in some sense it doesn't

put enough emphasis on independent critical thought, that

the government errs if you like in favour of control.

Looking ahead to the future as you've been doing, is that

your intention for the future as well, and do you feel that it

creates the best climate in which future leaders, your

successors, can cope with the unexpected?

PM : First, let me divide your statement because I think they are

two different things. One, that our education system does

not allow more independent thinking, more creativity, and

therefore, more scientists, more discoverers of the great

undiscovered frontiers of knowledge and science. I do not

think that is just a question of system of education. I think

it has to do with culture or with norms, standard behaviour

of students and teachers.

lky/1984/lky1009.doc 40

The Japanese face the same criticism and they want more

creative innovators. They are saddled with the same

criticism that they lack this questioning, this debate, this

ruthless pursuit of trust even at the expense of the dignity

of one's teachers.

I think we are all products of our own culture. And

oriental culture requires students to be polite, not to be

obstreperous. I mean, if you know so much you shouldn't

be in class. You should be running your own class.

At the same time because we've had so many foreign

teachers, some in our schools, definitely in our universities

and many of our teachers themselves having been educated

abroad, there is more give and take than say a typically

Chinese language school in the 1950s or 1960s. But I am

reconciled to accepting a more polite classroom situation.

I think that's part of oriental culture and we can't change

that. The media, on the other hand, is total different. I

mean, that's just a particular character, trait or not just

lky/1984/lky1009.doc 41

character. It's also culture. If you read the Indian

newspapers as I do in Delhi, there is such a plethora of

views. You are confused.

I think the East Asian is different from the South Asian.

The South Asian is the European and American

exaggerated because he loves debate for the sake of

debate.

In Japan, I've noticed that when they make important

decisions like rebuilding their defence forces, there is a lot

of kite-flying and then the tortoise draws in his head, then

he puts it out again, and he tests the water and he puts the

flipper out or puts a toe out. I think there's merit in that,

and they do argue very serious issues.

Whether indiscipline in the schools reflects something

fundamental in society, that consumerism and working

mothers have bred this restless violent generation, or what

is the reason for it, it's a serious questing.

lky/1984/lky1009.doc 42

But I would say the contentiousness of the American media

is like American wrestling on television. You know it's a

sham but people enjoy it because it is a sham. Everybody

knows that they down Reagan because he looks a winner,

and therefore, nothing like trying to cut him down a few

pegs. But when it comes to voting, do they really want to

vote out a man that's brought back a sense of well-being, a

sense of confidence, high purchasing power for the US

dollar, growth, lower unemployment?

Now, I do not believe the American system is either

desirable or affordable. I notice the British are trying to

copy the American. They weren't like the Americans

before, If you breach the Official Secrets Act, you just

went to jail. So because American officials release secrets,

that's supposed to be the 'in' thing. It shows that yours is a

free society where if any ministers, courts suppress the

truth, you feel it is your duty to leak it to the opposition.

That is something new and it's not proven. So when you

lky/1984/lky1009.doc 43

tamper around with the fundamentals of society, like new

values, what's right, what's wrong, the effects are in the

next, and often after the next generation. But it's a

philosophy of life and perhaps because I am conservative,

because one is a proven tested system, the other is not

proven, why not let the other chap prove it first? If he

proves it, that in fact all the contentiousness lead to a great

flourishing of scientific and technological discoveries and

plenty of everybody in great happiness and absence of real

social problems, it would be stupid not to look into those

possibilities for ourselves.

But when I see the countries that say, "Yes, let's abolish

the pornography laws," only I find that crime hasn't gone

down. In fact, it has gone up. The Danes haven't become

a healthy, virile, sun-loving people, but are even more

preoccupied with more hang-ups. And that pornographic

trade is in the billions of dollars and it's spread into

America, into Britain, into all the Western countries, less in

Japan because they take a more conservative approach and

lky/1984/lky1009.doc 44

they black out parts of nude photographs that come into

Japan. Well, I think there's some merit in it because the

final proof is what happens to the society.

Richardson : Well, our time has run out. We would like to thank the

Prime Minister for being with us tonight and for answering

a wide range of questions head on, and, to use one of his

words, "robustly".

Thank you.

PM : Thank you.

lky/1984/lky1009.doc