Transcript of Minister for Foreign Affairs Dr Vivian Balakrishnan's Interview with Reuters Global Managing Editor for World News Mark Bendeich, 23 March 2026

Mark Bendeich (Reuters): We are going to start off with, obviously, the Iran war. I wanted to ask you, for those investors and businesses who are deciding now to leave Dubai, what would you say to them about Singapore, at the moment, as a destination for investment and capital?

Minister Vivian Balakrishnan: That is rather narrowly focused. If I take a step back, 90% of the volume of oil that normally traverses the Strait of Hormuz is usually destined for Asia; another 10% or so for maybe Europe. If you look at LNG [Liquefied Natural Gas], 83% of LNG that transits through the Strait of Hormuz is destined for Asia. Right now, the closure of the Strait of Hormuz is, in a sense, an Asian crisis. Now, I know the military protagonists are basically Western versus Iran and the Gulf states themselves, but the economic impact is going to be predominantly Asian. You have this asymmetry of the military dimension and the economic dimension. A lot of people still have not realised: in 2016, America overtook Saudi Arabia to become the largest oil producer; in 2017, the largest natural gas producer. By 2019, America was a net energy exporter- very different from the circumstances five decades ago. Remember, there was a Carter Doctrine on the importance of the Strait of Hormuz for America? You think about the Gulf wars, the strategic calculus and the dependence of America on uninterrupted energy supplies is completely flipped. My first point: this is actually a big Asian problem. Depending on how long this continues, it can well lead to a crisis. It is a crisis not just of energy, but of other secondary impacts. Fertilizers, which then will impact the yields from the harvest. And again, I would remind your readers to remember four or five years ago, when Sri Lanka tried to do away with fertilizers, and you saw the impact on yields. So that is another knock-on impact which we worry about which will come about later. In fact, my colleagues in Asia are deeply worried, and we have obviously been having a lot of discussions, formal and informal, amongst ourselves, as to what to do, how to respond, and what the prognosis for the situation is.

Bendeich: On that, what is the worst-case scenario for an Asian crisis, and how does Singapore respond?

Minister: First, let me deal with it as Asia as a whole. We are net energy importers from the Middle East and the Strait of Hormuz. It is something which has been there for a long time. The vulnerability is known, but it has never been tested to the extreme that it is being tested today. In fact, the next 12 to 18 hours are the critical hours when the deadline expires, because if indeed you get tit-for-tat destruction of energy infrastructure, then you are dealing not only with an immediate blockage of the Strait, but you are dealing with scarring of energy infrastructure from the Middle East, which means a prolonged period in which energy exports will be diminished. This will have an impact. The first order impact is high oil prices, high gas prices, accompanied by high volatility. The second order: in practice, you will have an increase in inflation across the board. And of course, the worry beyond that is that these things tend to become sticky, and all this is happening at the time when Asia was hoping to be on more stable footing and getting growth in order, and spreading the fruits of that growth to as many people within your population as possible. It is not coming at a brilliant moment. That is where both the economic and political anxiety is. We will have to see. Obviously, this is just a top line summary. You will have to look at it country by country to assess probabilities and sometimes opportunities. But right now, this is a time to be worried. This is a time to assess our abilities. This is a time to dust off contingency plans and put everything on the table.

Bendeich: And Singapore’s contingency plans. What would they include?

Minister: First, let me put it to you this way. We are an energy importer. There is no doubt to it. Fortunately, we have diversified our sources of energy, although I will say that a significant proportion of our LNG obviously comes from the Gulf. We have got some very good, steady, and reliable friends amongst the Gulf states, who have absolutely been trustworthy, reliable partners all these years. But through no fault of theirs, this transmission of energy to Singapore has been impacted. Fortunately, because we have LNG terminals, we are therefore able to import from the world market. And also, fortunately, because we have got the fiscal buffers. We will have to pay what the international rates are. What I will not go through in detail is that we also have buffers internally – reserves, which all countries should have. But none of this will protect us from the inflationary impact of high energy prices. This is something which we will have to deal with within our economy and obviously from a social security point of view. Fortunately, you may recall that one of the criticisms levelled at us in the recent Budget debate was our surplus that was unexpectedly high. At a time like this, we should all be thankful that the Finance Minister, who happens to be our Prime Minister, has a few cards up his sleeve.

Bendeich: Do you think he will need to play those chips up his sleeve?

Minister: I am not in a position to make pronouncements, or maybe you have to ask him that. We are watching this situation very carefully as an open economy, as an economy where trade is three times our GDP, as an energy importer, all these amber lights are flashing for all of us. What to do depends very much on how high prices go, how long it prolongs, and what happens when you get the inevitable restructuring of supply chains, and you will have to adapt. It is still too early to be definitive, but the point is Singapore is fortunate that we have got some fiscal buffers. We are fortunate that we have significant sovereign wealth funds that generate returns. For most countries, including some very big countries, they spend a significant chunk, sometimes up to 3% of GDP, servicing debt. For us, it is a complete reverse. We are collecting dividends on our reserves, so having that fiscal firepower is essential.

Bendeich: You lived through the Asian Financial Crisis, then the Global Financial Crisis. Is this potentially something that, for Asia, rivals or even exceeds those previous crises?

Minister: It is too early to say, but as someone who has lived through those, you always want to prepare for the worst and hope for the best. Anything after that is an upside.

Bendeich: Minister, are you disappointed in the US?

Minister: I am disappointed that the negotiations broke down. I will confess that I was surprised with the onset of hostilities. I did not think it was necessary. I do not think it is helpful. Even now there are doubts expressed about the legality of the situation. But let us set all that aside. Let us just be realistic. This is a pile of bad news, and what we are witnessing is actually, whether you realise it or not, the entire global economy has been taken hostage and we will all pay a price on hostilities. It is what it is. As I said, the key parameters now are how high and how long and what are the secondary scarring effects it has on infrastructure in the Middle East and on the real economy, especially in Asia.

Bendeich: Is the US any longer a reliable, steady partner?

Minister: The US is now a revisionist power. For 80 years, the US was the underwriter for a system of globalisation based on UN Charter principles, multilateralism, territorial integrity, sovereign equality. It actually heralded an unprecedented and unique period of global prosperity and peace. Of course there were exceptions. And of course, the Cold War was still in effect for at least half of the last 80 years. But generally, for those of us who were non-communists, who ran open economies, who provided first world infrastructure, together with a hardworking disciplined people, we had unprecedented opportunities. The story of Singapore, with a per capita GDP of 500 US dollars in 1965. Now, [it is] somewhere between 80,000 to 90,000 US dollars. It would not have happened if it had not been for this unprecedented period, basically Pax Americana and then turbocharged by the reform and opening of China for decades. It has been unprecedented. It has been great for many of us. In fact, I will say, for all of us, if you look back 80 years. But now, whether you like it or not, objectively, this period has ended. There is no point trying to assign blame or pejorative adjectives. That is not helpful. Basically, the underwriter of this world order has now become a revisionist power, and some people would even say a disruptor. But the larger point is that the erosion of norms, processes, and institutions that underpinned a remarkable period of peace and prosperity; that foundation has gone. What you are seeing now, whether you watch the war in Ukraine, in the Middle East or elsewhere, including in Asia, to me these are symptoms of the underlying tectonic rupture. Big powers and even lesser powers have a more narrow definition of national interest. [They] are willing to weaponise all levers in their hands. You look at the weaponisation of currency, weaponisation of technology, weaponisation of critical minerals, weaponisation of trade interdependency, which were supposed to keep us at peace with one another- now it becomes yet another portal for exploitation. You end up with a world in which strategic trust has dropped. Everyone has to assume the worst. You are more likely to assign nefarious motives towards others, even when in fact, they are just trying to take precautions and engage. So just trying to take the world as it is, rather than trying to assign blame or to use pejorative adjectives.

Bendeich: Where does Singapore look now, for a partner? China?

Minister: No. Let us get back to basics. As I said, what has not changed for Singapore: we are small, with no natural resources, certainly no energy. We are still trade dependent. If you measure the stock of FDI in Singapore, the United States is number one, by orders of magnitude. If you look at trade, China is our biggest trading partner [in goods]. The United States is our biggest trading partner in services. If you look at investments and you ask the Chinese, very often, they will tell you that Singapore has been a large source of FDI into China for the past dozen years. You have to verify that with the Chinese themselves. Is it in our national interest to be forced to choose sides? I do not think so. We have to be relevant, to be useful, but not being used by either side. In other words, from time to time, Singapore will have to say no to the United States or to China. But it must be very clear that when we say no, it is not done at the behest of the other but done after a careful computation of our own long term national interest. Now to the extent that we can manage a constructive, honest relationship with both, we have to do our best to maintain it. That gives us strategic choice, strategic autonomy. To be fair to both America and China, neither side is stridently banging the table and saying, choose and choose now. Of course, they would like us to lean one way or the other, but using Singapore as a kind of reference, which means, depending on the issue, depending on the choices we make, it is significant. Our independence of thought and analysis and the decisions that flow from that in fact is part of our value proposition. So that is as far as the big powers go. If you look at the middle powers, and Europe is a key plank of that- in fact, we believe that the majority of countries still subscribe to the UN Charter, still believe in settling things through multilateral processes, in global supply chains, in open economies, and in free trade. Singapore has 27 Free Trade Agreements, about half of them bilateral, another half plurilateral. In fact, it covers about 90% of our trade. To be fair, except for the tariffs that the US is applying toward us, none of our other trading partners have imposed tariffs on us. So the point is, there is still scope to make common cause with the majority, and especially with the middle powers. And by that I mean Europe, India, Japan. And we have got new frontiers for us, in Africa, in South America, for whom we think there is still an appetite for this model of multilateralism and a rules-based open trading system. You see us working hard beneath the surface, trying to build those new arteries to keep trade and economics flowing. The other aspect is that you may have noticed that, in addition to the 27 Free Trade Agreements, we have also got a growing slew of digital economy agreements, and that is where we believe future opportunities lie. Particularly with the growth of digital technologies, with AI, and how this will impact services, trade, and how value can be brought about by interoperability standards. And for all of us, not just the big boys but for all countries, to have a say in how the global digital economy evolves. Now we are trying to do all this while all the banging of the war drums is going on. It is a challenge, but it is essential, and it is necessary, and we will focus on that as well.

Bendeich: You mentioned the real risk of an Asian economic crisis. Is there also a risk of this becoming another kind of crisis? For example, the risk of China taking Taiwan. Do you see that the risks there have increased as well?

Minister: Well, I cannot speak for China. What I would say is that war across the Straits is not inevitable. It is not the first choice of China and we hope that all these wars elsewhere instead will give pause to Asia, that wars will not solve anything. At the end of the day, it is still going to get back to the negotiating table, except that lives would have been lost, economies would be damaged, infrastructure demolished. I would like to believe that cooler heads will prevail in Asia. But we will see how the events unfold.

Bendeich: You mentioned that Singapore has to say no at times.

Minister: At times, it depends on the issue.

Bendeich: Is there anything now that Singapore is under pressure to do or reciprocate with the US or China and is prepared to say no?

Minister: Nothing specific at this point. Well, you take the US – we used to be subjected to the 10% tariff. I could not help pointing it out to every American counterpart: America has a surplus against Singapore. There should be no reason for a tariff, even 10%, to be applied to us. Sure, it is not personal, America needs a revenue, and that is the baseline. If that is the case, we will live, we will evolve, we will survive. That is an example. With China right now, relations are excellent. My Prime Minister is headed there in fact – to speak at the Bo’ao Forum. From time to time, I am sure we will have something or another to have some disagreement on. But foundational pillars of the relationship are strong and intact. We need some stability in Asia. In fact, we need it precisely to deal with the economic instability and challenges which are going to emerge as a consequence of the war in the Middle East. We will see. As I said, we have divided our attention span into the next 18 hours, the next three months, and then the next three years. In the 18 hours, let us see what happens when the ultimatum that President Trump has issued expires. In the next three months, how long is the Strait of Hormuz going to be closed. This will impact inflation, government fiscal policies, the inevitable slowdown in growth rates throughout Asia, and the resilience of the individual economies. It is a very diverse collection of economies. For three years, if you look at it, number one, we do need to accelerate the resilience of energy. In our case, the ASEAN power grid, to enhance resilience for all the economies. We do need to continue to upgrade our digital infrastructure. We do need to upskill our labour force, our people, to have the necessary skills for the jobs not of yesterday, but the jobs to come in the next three years. And we need to do all that whilst keeping government coffers balanced and to make sure that there are no grants on our economies or our currencies. It is a time to be careful, but you cannot afford to be paralysed. This is like being on a bicycle on a tightrope. You have got to keep going.

Bendeich: In terms of having that big fiscal buffer, you mentioned the economy and currencies are protected. Is that what the fiscal buffer could be used for, to defend the Singapore dollar, if need be?

Minister: The Singapore Government has always been a worrier, and that leads to a certain conservative fiscal stance, which we often get criticised for both internationally and domestically. But at times like this, or in fact, we think about the most recent crisis on COVID, and before that, the Global Financial Crisis and Asian Financial Crisis, it always helps to have some buffers. The other point about Singapore is to understand that in every crisis, there are opportunities, and how we can take advantage of the opportunities. It is too early to be specific, but I would say for us in Southeast Asia, it is a reminder that you cannot be an oasis alone. You can be wealthy, you can have defence, but you need your region to be at peace. You need your neighbours to have the diplomatic habits of resolving differences peacefully and of understanding that our long-term interests lie in keeping the peace and security, and focusing on economic development and opportunities for our people. Because, ultimately, that is what our people want, that is what the voters want, and we should be focused on that. I am hoping that we in Asia will get through this stressful time. What does not kill us will make us stronger, and in particular, brings us closer together within ASEAN and within Asia as a whole. And also the opportunities, because we all need to diversify. The opportunities now to engage with the Global South, in Africa, in South America. If you look at South America, particularly on the Pacific coast, you look at Africa, there are much fewer choke points. In fact, the choke point is the Straits of Malacca. But that is our only immediate neighbour. And so long as the littoral states, which, in this case, for the Strait of Malacca, is Indonesia, Malaysia, and Singapore, so long as we all operate on the basis of UNCLOS, maintain the UN Convention on the Laws of the Seas, which provides for freedom of navigation in all circumstances, for straits use, for international navigation, of which the Strait of Malacca is one and so should have been the Strait of Hormuz. If we maintain that resolution to remain open, that is absolutely essential and imperative. All these troubles elsewhere which are affecting us are a reminder keep our own backyard in order.

Bendeich: This is something Josh actually watches very closely, so I’m going to let him –

Minister: Sure.

Southeast Asia Bureau Chief Josh Smith (Reuters): On the neighbourhood, and changing the subject slightly, there seems to be more momentum for a permanent ASEAN envoy to Myanmar. Our colleagues in Thailand are talking it up to us quite a bit. And I wanted to ask you, what you know of the status of that, and if it is moving forward, what would that mean for ASEAN engagement with Myanmar, especially kind of at this juncture with their election.

Minister: The key variable for Myanmar is domestic. Meaning, is there a genuine and comprehensive political reconciliation, which takes into account all the stakeholders? Are they talking to one another? Are they resolving differences constructively and respectfully? If that internal political conversation is not working or not working as effectively as it should, nothing that ASEAN does or the identity of the envoy, or even the tenure of the envoy, is going to make a real difference. So let us understand that the ultimate answer is domestic. It has been since independence. It continues to be a big challenge for Myanmar until now. Second point is, if you think about the political transitions in Myanmar, the most recent one when Aung San Suu Kyi first returned to Myanmar in the 1980s and when she became State Counsellor in 2016, that was more than 25 years. Could it take another 25 years? I do not know. I hope not. But could it take that long? It again depends on the nature of the political transformation within Myanmar itself. I have always counselled strategic patience when dealing with very complicated political situations. And my third point is that external interference in domestic political processes always ends up as a vicious cycle. We have seen so many examples, you do not even need to look in Asia, you can look elsewhere. That is my attitude. I hope that there will be domestic reconciliation. I hope ASEAN maintains its stance of non-interference and the selection of envoy and the terms of the envoy must be constructive to that process and not complicate matters further. Again, we will see. But Myanmar is probably going to be one of the countries least equipped to deal with this crisis, and that is a source of concern. Regardless of the politics, you must maintain humanitarian solidarity and help one another.

Bendeich: If you had an audience with Donald Trump, what would you tell him?

Minister: That we all hope the hostilities will cease as soon as possible, that we hope the Strait of Hormuz can be open. But I think I know his answer to that. He will say, well, it is an Asian problem. It is not an American problem. In fact, I suspect he may have already said that before. Which, in a backhanded way, also reflects the reality that no country, no matter how powerful, exists as an island, and any unilateral actions taken will have complicated downstream impact. And that is why, maybe I am biased, because from a diplomatic point of view, it is always better to have constructive engagements and conversations, difficult conversations, spikey conversations, even. But that is always better than outright hostilities, than military action. I am struggling to find any modern example where the application of overwhelming military force, even if it has resolved a domestic or even international political crisis. If you can think of one, please let me know.

Singapore Chief Correspondent Kok Xinghui (Reuters): Earlier you mentioned that in every crisis, there are opportunities, and it is too early to really know when to take advantage of this opportunity, right?

Minister: I cannot get into specifics, but let us put it to you this way. If Singapore can get through this crisis, and I expect we will, with a combination of a competent government, a realistic population, and everyone doing what needs to be done to make sure no one gets left behind – I’m referring to social security. At the same time, we do not panic, we do not do economically counterproductive measures, and we stick to doing what we do best, which is to open, to be reliable, to be trustworthy, to honour the sanctity of contract, to be a vital, totally reliable node in a global value chain and in a region which is at peace with itself. And I think there would be opportunities for us. Can I see some silver linings? Yes, I have seen potential silver linings. As long as we get through this together. And I say together, it is not just Singapore, but ASEAN and Asia as a whole. This is a time for multilateralism. This is a time for cooperation. This is a time for us not to panic and not to resort to hasty measures which impede global supply chains. Because if you panic, you actually damage your long run position, your reputation of reliability, and I think in the state of the world now, some stability, some predictability, some safety, would be a very welcome bright spot in an otherwise difficult, volatile world. In very general terms, this sets out what we are trying to do and that plays to our strengths as Singapore and as Singaporeans.

Bendeich: Thank you, Minister.

. . . . .

MINISTRY OF FOREIGN AFFAIRS

SINGAPORE

24 MARCH 2026

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