Straits Times

S'pore, China to discuss collaboration on public health, economic rejuvenation at high-level meeting

Linette Lai

Political Correspondent

7 Dec 2020

In response, Mr Heng brought up *China's new "dual circulation" strategy*, which envisions a new economic development strategy relying less on global integration and more on expanding domestic commerce*.

*Singapore, as a regional hub for trade, finance and logistics, can be a key partner in China's "external circulation", he said*.

He also reiterated his earlier point on enhancing connectivity, including financial connectivity. As China's share of the global gross domestic product grows, there will be greater use of the renminbi for portfolio and direct investments into China, Mr Heng said.

"Today, Singapore is among the top three offshore RMB (renminbi) centres in the world. We should build on this, to deepen capital market linkages and financial flows."

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[12:01 pm, 02/11/2020] ☸️  Danny 心: 

31 Oct 2020

(1) China new economic strategy for the next 5 years - will come with the main theme which comprise of 2 tracks :-

(a) External circulation

(b) Internal circulation

(2) As China is facing increasingly difficult business environment due to Trump strong pressure to squeeze China out of trade (through trade war), technology (through tech sanctions of China tech companies) and finance (by sanctioning the finances of Chinese officials through the SWIFT US dollar system) ---- China has coin 2 tracks system --- namely "dual circulation" for its next 5 years new economic strategy.

(3) China is looking at :-

Creating a 2nd track - known as "Internal circulation" - to boost its Economy - & to mitigate and cushion the external pressure its faces from Trump 3 prong attack on China's :-

a. external trade and supply chain, 

b. tech sanctions by cutting out China tech business from US market and the world market as well as restrict US tech resources from being used by and to be sold to China tech firms

c. financial sanctions on China top officials.

(4) China "Internal circulation" predominantly focus on 3 tracks :-

a. Ramping up internal massive domestic consumption from its large domestic markets.

b. Ramp up its R&D - notably by reinventing the whole supply chain of semi-conductor industries to create its own chips instead of relying on US chips developed, design by US tech. as well as pushing forward its R&D edge in 5G, AI, quantum tech, etc.

c. Create its new digital currency or digital yuan known as DCEP (Digital Currency Electronic Payment) and wrench itself out of US Dollar Swift system in Global financial system.

Effectively, China will have created a bifurcation strategy - independent of US ecocnomic orbit, technology spaces and financial sytem.

What opportunities can Singapore seize from China's new economic strategy and the 2nd Global bifurcated system?

1. *Continue to cooperate with China in trade, business, investment, travel etc through its "External Circulation".*

2. Work with China to tap and integrate with its new "Internal circulation" that aim to tap on its huge domestic market to boost Economic growth.

a. Singapore have joint venture with China in building many Eco-cities and industrial parks.

b. Singapore have the largest investment in China with many local companies investing in many provinces in China.

c. Singapore investors in China should be able to seize the 3 tracks in China's new"Internal circulation" and increase its business revenue and profits. This will be a big opportunities for Singapore firms invested in China - as China domestic market is a "huge market".

d. Importantly Singapore business must be able to :-

i. Sell to its large domestic consumers.

ii. Value-add to the high-tech industries that China is expending great effort to create.

iii. Participate and seamlessly integrate with China DCEP digital yuan and continue *to strengthen Singapore as yuan currency exchange through offshore yuan trading hub as well as operating as gateway between China financial system as well as the World financial system through SWIFT*.

3. When the covid pandemic blow over, Singapore will be poised to emerge stronger economically and seize the opportunities offer by China's economic shift.

a. To cruise again in US bifurcated Economic System

b. To jumpstart our integration with China bifurcated Economic System