‘Bridge-builders’ like Singapore, Sweden key amid risk of fragmented world order: President Tharman

“They have the largest markets. They are the largest sources of innovation. They have an overwhelming share of global AI compute. And they are essential, by virtue of their scale of carbon emissions, and in China’s case, its technologies, to tackling climate change,” he said.

“It may appear odd to say this, given the current political mood in the United States. But the US as many know, is never unchanging. It isn’t just a matter of whether the Republicans or Democrats win elections. Change also depends on the body politic.”

The president said that top surveys have consistently shown that the majority of Americans like the idea of global cooperation.

“We cannot expect the US to get back to the responsibilities it assumed under Pax Americana, but neither should we assume an unchanging political mood,” he added.

The biggest difficulty in achieving a stable global order is that the world has two major powers which are “not only interdependent economically, but are close to being peers in competition”, said Mr Tharman.

He outlined three things that would help the US and China achieve stability in their relationship.

First, both countries have to view interdependence and competition as a relationship to be managed, especially to constrain the weaponisation of materials and technologies, rather than a threat to be eliminated.

“It will surely be a more dangerous world if we end up with whole AI and technology stacks decoupled, and other supply chains and payment systems decoupled. It will make for a more profoundly dangerous world,” he added.

Next, it has to be recognised that there is “no finishing line” in the AI race, Mr Tharman said.

“There is no point at which we can say that the US or China has won decisively and permanently. Equally, the common threats will only grow, for that the US and China and all of us – the threats not just of rogue AI agents, but of rogue human actors using AI to develop more powerful cyber,” he said.

“And what AI has done is to reduce dramatically the gap between the ability of large, organised actors and lone, non-state actors, to develop powerful new cyber, biological or chemical weapons. No country can deal with this threat on its own.”

Finally, the US and China have to recognise that their domestic imbalances, including deficits, have significant international consequences, said Mr Tharman. Reforms to reduce these imbalances are in the own domestic interests, as well of that of the rest of the world.

“The US cannot keep deferring the tough choices it has to make to reduce its deficits. They will exert a growing cost domestically, and be a source of instability,” the president said.

“China, too, has to recognise that to continue to be a large source of supply of goods to the world, it will have to be a larger source of demand than it is currently.

“Reforms within China are underway, but it will need time to raise consumption. In the meantime, temporary management of China’s exports, such as in its recent agreement with the EU on hybrid vehicles, and a shift in balance from exports to foreign direct investment in markets abroad, have useful roles to play.”