SECRETARY OF LABOR CHAO MEETS SINGAPORE PM LEE

C O N F I D E N T I A L SECTION 01 OF 04 SINGAPORE 001015

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E.O. 12958: DECL: 09/18/2018
TAGS: ELAB PREL PGOV OVIP SN
SUBJECT: SECRETARY OF LABOR CHAO MEETS SINGAPORE PM LEE
HSIEN LOONG, AUGUST 29, 2008

Classified By: AMBASSADOR PATRICIA L. HERBOLD FOR REASONS 1.4 (B) AND (
D).


1. 1. (U) August 29, 2008; 1:30 p.m.; the Istana (the
Palace).


2. (U) Participants

United States

Secretary of Labor Elaine L. Chao,
Ambassador Patricia L. Herbold,
Associate Deputy Secretary of Labor Anna Hui,
Dr. James Chao, and
DCM Daniel Shields (notetaker.)

Singapore

Prime Minister Lee Hsien Loong,
Acting Minister of Manpower Gan Kim Yong,
Senior Minister of State (National Development, Education)
Grace Fu,
Principal Private Secretary-designate to the PM Ng How Yue,
Ministry of Manpower Permanent Secretary Leo Yip, and
Senior International Relations Manager Lim Choon Leng
(notetaker.)

Summary
--------------


3. (C) Secretary Chao and PM Lee noted the strength of
U.S.-Singapore relations and reviewed political and economic
developments in Singapore. PM Lee said China is focused,
growing stronger, and well aware of its strength. China
wants to be friends with everybody, but "when they want
something from you, you will know it." Many countries in
Southeast Asia are already America's friends and are waiting
to do more as friends. India is a growing presence in
Southeast Asia, but China's trade with the region is four
times India's trade. PM Lee said that despite all the United
States has done for Muslims in places like Bosnia and
Indonesia, the United States is still seen by many Muslims as
the "bad guy" or the "Great Satan." This is not a problem
that can be fixed by better U.S. public affairs efforts. It
is at a deeper level. It involves not only Iraq, but also
the Palestinian issue. The situation in Georgia is a
reminder for small states, including Singapore, that they
must be able to defend themselves and avoid ethnic splits
that outsiders can exploit, PM Lee said.


U.S.-Singapore Relations
--------------


4. (C) PM Lee welcomed Secretary Chao and thanked her for
attending the Singapore National Day event in Washington.
Secretary Chao praised Ambassador Chan Heng Chee's
effectiveness in Washington and noted the strength of the
bilateral relationship. The PM commented on the importance
of the Strategic Framework Agreement and of the extensive
trade ties that bind the two countries. In the area of
labor, Singapore's National Trade Unions Congress (NTUC)
cooperates with the AFL-CIO through the International
Confederation of Free Trade Unions (ICFTU),the PM said.

Singapore Political Developments
--------------


5. (C) Secretary Chao inquired regarding political
developments in Singapore. The PM said Singapore wants
democracy with stability. Singapore keeps changing and so
must its political system, as recent debates in Parliament
show. (Note: PM Lee was referring to Parliamentary
discussion of his National Day speech proposals to loosen
some restrictions on political films, political material on

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the internet during elections, and outdoor demonstrations.
End Note.)

Singapore Economy
--------------


6. (SBU) Secretary Chao asked about the Singapore economy.
The PM said the economy continues to do well, but some
Singaporeans are feeling the pressures of globalization and
inflation, which is up to 6-7 percent. A certain degree of
income redistribution is inevitable, but it won't solve the
problem. Singapore has a firm market ethos, coupled with a
limited social safety net, he said.


7. (SBU) Secretary Chao commented that the U.S. economy
faces well-known challenges, but U.S. 2nd Quarter GDP growth
has been revised upward to 3.3 percent and the
14.3-trillion-dollar American economy remains resilient and
dynamic. PM Lee said Singapore's economy is closely linked
to the U.S. economy. Singapore's exports to the United
States dropped off in recent months. Demand from China and
India can offset that to a certain degree, but even from
those countries, the numbers of tourists visiting Singapore
are down. Singapore will be opening integrated resorts with
casinos, which should bring in more tourists, the PM said.

China
--------------


8. (C) Secretary Chao elicited the PM's views on China. PM
Lee said China is focused, growing stronger, and well aware
of its strength. China wants to be friends with everybody,
but "when they want something from you, you will know it."
Singapore, like other countries, wants friendly relations
with China. There is significant immigration from China to
Singapore, including skilled technicians and professionals.
This is good for Singapore, but it creates some social
tensions when Singaporeans are forced to compete with Chinese
talent, PM Lee said.


9. (C) Secretary Chao asked how PM Lee sees the U.S.-China
relationship. PM Lee said Singapore wants to be friends with
both countries. Singapore is disappointed when urgent
business elsewhere keeps U.S. officials away from regional
gatherings where China is present. China seeks to expand its
regional influence by means such as constructing a Parliament
building in Myanmar or a Foreign Ministry building in Timor
L'Este. Beyond the region, China's success in hosting a
Summit for 50-plus African leaders is something that India
and Japan have tried, but not been able, to match. In this
context, Southeast Asia needs the United States around.
Australia and Japan are important too. Europe has not yet
shown that it can match its economic clout with military or
security influence in this part of the world. Many countries
in the region are already America's friends and are waiting
to do more as friends. America's Asia policy is not the same
thing as America's China policy, the PM said.


10. (C) PM Lee said the Olympics were a great success, but
the controversy surrounding the torch rally caught China by
surprise. Chinese Ambassador to London Fu Ying caught the
tone of it in a piece she wrote for the Daily Telegraph
noting her daughter's question: "why do they hate us?"
China, as a big power, will of course protect its interests,
but China needs to figure out how to infuse its policies with
some idealism and breadth, not just realpolitik, PM Lee
stated.


11. (C) Secretary Chao noted that there is much discussion
in China of building an innovation society, but America's
success in innovation is profoundly linked to broader
American freedoms. PM Lee said that some places, like
Europe, impose few constraints on their citizens, but are not
particularly innovative. Other places, like Israel, impose
considerable constraints on their citizens, but are very

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innovative. It is hard to say how China will do on
innovation. China has most of what it needs to succeed, but
it lacks truly first-class universities, scholars,
researchers, and Nobel Prize winners, the PM said.


12. (C) PM Lee said there are still some taboo subjects in
China, like political reform and Taiwan, but most other
subjects can be discussed relatively freely. The quality of
the Chinese media, including television, has improved
enormously, with skilled reporters now asking serious
questions. Ten years ago, China's propaganda chief visited
Singapore and asked how Singapore manages the media and the
Internet. Lee responded that it is not really possible to
control the Internet. This did not stop the Chinese from
making great efforts to clamp down on the Internet, he noted.

India
--------------


13. (C) Secretary Chao raised the role of India. The PM
said India is looking outward and its role in Southeast Asia
is growing, but India is not as focused as China. India's
complex politics poses challenges. Singapore has been
working to increase India's involvement in the region through
means like the East Asian Summit. As India's trade with the
region grows, so should its influence. India and ASEAN have,
after years of effort, concluded the goods part of an
India-ASEAN Free Trade Agreement. But the reality is that at
present, China's trade with the region is four times India's
trade, PM Lee said.

Islamic World
--------------


14. (C) Secretary Chao asked about U.S. engagement with the
Islamic world, especially Pakistan. PM Lee expressed concern
about the volatile current situation in Pakistan. As for the
broader issue of U.S. engagement with the Islamic world, it
is unlikely that Islamist terrorists can pose an existential
threat to the United States unless they get nuclear weapons.
They can still kills hundreds of people at a time though
suicide attacks. The challenge for the United States is to
address that threat without turning ordinary Muslims against
America. That is not easy, he said.


15. (C) PM Lee said that despite all the United States has
done for Muslims in places like Bosnia and Indonesia after
the tsunami, the United States is still seen by many Muslims
as the "bad guy" or the "Great Satan." To a certain extent,
Americans just have to "live your karma." Powerful countries
are going to be resented. There is, however, also a policy
dimension to the problem and it is not something that can be
fixed by better U.S. public affairs efforts. It is at a
deeper level. It involves not only Iraq, but also the
Palestinian issue. In Malaysia, Al Jazeera TV is available
24-hours-a-day in the Malay language. People are watching it
and many believe what they hear on it. Even in a moderate
place like Malaysia, one of the few things nearly all
influential politicians can agree on is the importance of the
Palestinian issue, he noted.

Georgia
--------------


16. (C) Secretary Chao raised the Georgia issue. The PM
said awareness of the matter is low in Southeast Asia. The
situation is a reminder, however, for small states, including
Singapore, that they live in a dangerous world. The rule of
law and the UN are no substitute for the ability of a state
to defend itself. Also, the Georgia situation reminds
multi-ethnic states, including Singapore, of the need to
avoid ethnic splits that outsiders can exploit, PM Lee stated.

Next U.S. President's Agenda?
--------------

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17. (C) Secretary Chao asked PM Lee what he thinks ought to
be on the agenda for the next U.S. President. PM Lee said
free trade and globalization will be important. In
Singapore, people understand that if they do not trade they
will starve. In the United States, this is less obvious,
given the size and resources of the country. The Prime
Minister said other salient issues will be Iraq and
Afghanistan. Iraq seems to be stabilizing, although there is
less evidence of this in Afghanistan. In both countries
there are no easy solutions, but walking away is not an
option. PM Lee said another key issue will be U.S. policy
toward Asia and China.


18. (U) Secretary Chao's party cleared this message.

Visit Embassy Singapore's Classified website:
http://www.state.sgov.gov/p/eap/singapore/ind ex.cfm
HERBOLD