By Prof Tommy Koh: 10th Anniversary of the USSFTA
October 29, 2014
Singapore and the United States: Answering the Business
Transformation Challenges for the Next Decade
Seminar co-organised by Amcham and SBF
Speech by Professor Tommy Koh, Singapore’s Chief Negotiator,
US-Singapore Free Trade Agreement
2. Mr James Andrade, Chairman of AmCham
3. Ms Judith Fergin, CEO of AmCham
4. Mr Ho Meng Kit, CEO of SBF
5. Amb Kirk Wagar, US Ambassador
6. Mr Ong Ye Kung, Deputy Chief Negotiator, USSFTA
7. Mr Douglas Foo, President of SMF
8. Dr Ahmad Magad, Chairman of Panel 1
9. Dr Parag Khanna, Chairman of Panel 2
10. Ladies and Gentlemen
(II) Celebrating USSFTA’s 10th Anniversary
1. Judith Fergin has invited me to speak to you in my capacity as the Chief Negotiator for Singapore, in the USSFTA negotiations.
2. President Bill Clinton and PM Goh Chok Tong agreed to launch a negotiation to conclude the USFTA, in Brunei, on 16 Nov 2000.
3. I was appointed as the Chief Negotiator on 16 Nov 2000. Ong Ye Kung was appointed the Deputy Chief Negotiator at a later date.
4. The 1st round of the USSFTA negotiations was held in Washington DC from 4-21 December 2000.
5. The 11th and final round was held in Washington DC from 11-19 Nov 2002.
6. The USSFTA was signed in Washington on 6 May 2003 by President Bush and PM Goh.
7. The USSFTA passed the House of Reps on 24 July 2003 by 272-155 votes.
8. The USSFTA passed the Senate on 31 July 2003 by 66-31 votes.
9. The USSFTA came into force on 1 Jan 2004.
(III) USSFTA Is A Success Story
1. The USSFTA is a great success story.
2. First, the USSFTA has boosted trade between our two countries. In 2012, bilateral trade was $118.8 billion. US exports of goods to Singapore have increased by over 85%. US exports of services to Singapore have increased by over 100%. Singapore’s exports of services to the US have increased by 104%. However, Singapore’s exports of goods to the US have fallen by 26%.
3. Second, the USSFTA has had an even more dramatic impact on the two-way investment picture. By the end of 2013, US investment in Singapore reached US$154 billion. This is bigger than the US investments in Japan and in Australia. Singapore is the US’ No. 1 investment destination in the Asia Pacific. There are 3,600 US companies in Singapore.
4. You will be surprised to know that Singapore has become the 4th largest Asian investor in the US, after Japan, Australia and South Korea. According to PM Lee, Singapore companies have supported about 40,000 jobs in the US. For example, Keppel AmFels, which manufactures equipment for the offshore and marine industry, is currently one of the largest employers in South Texas, with close to 2,500 workers.
5. Third, the USSFTA is good for the political and security relationship between our two countries. As PM Goh said recently, “ultimately, trade is strategy. The FTA was for geopolitical reasons, not just about lowering tariffs and more trade.”
1. I want to leave you with 3 concluding thoughts.
2. First, as the USSFTA has demonstrated, free trade and investment benefits all countries. We need to convey this message to the members of the US Congress, organised labour and other stakeholders in the U.S.
3. Second, we support President Obama’s Pivot to Asia or Rebalancing with Asia. My understanding is that the policy is pro-US but not anti-China. The US supports the ASEAN vision that our region should be open to all but aligned to none. As a resident power, the US wishes to continue to play a leadership role in the region. This is welcomed by the region.
4. Third, the US policy cannot be uni-dimensional and focus only on security and the military. It must be a comprehensive engagement, involving business and economics, culture, education, environment, etc. We need more investment from America and more trade with America. Economically, the US is falling behind. From being no. 1, it is today ASEAN’s 4th largest trading partner.
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