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P 250937Z JAN 10
FM AMEMBASSY SINGAPORE
TO RUEHC/SECSTATE WASHDC PRIORITY 7726
INFO RUCNARF/ASEAN REGIONAL FORUM COLLECTIVE
RUEHNE/AMEMBASSY NEW DELHI 2438
RUEAIIA/CIA WASHDC
RHEHNSC/NSC WASHINGTON DC
RHHMUNA/CDR USPACOM HONOLULU HI

C O N F I D E N T I A L SECTION 01 OF 04 SINGAPORE 000102 
 
SIPDIS 
 
E.O. 12958: DECL: 01/25/2020 
TAGS: PREL ETRD OREP ECON PINR SN ASEAN
SUBJECT: SENATOR BOND IN SINGAPORE: TAKING THE PULSE OF THE 
REGION AND APEC 
 
Classified By: Classified by Charge d'Affaires, a.i., Joel Ehrendreich, 
 reason 1.4 (b) and (d). 
 
¶1. (C) Summary.  Over the course of a full day of meetings, 
Senator Kit Bond spoke with numerous Singaporean leaders and 
intellectuals on a broad range of regional issues, to include 
U.S.-Singapore relations, Indonesia, China, India, Vietnam, 
Malaysia, Thailand, Burma, as well as economic opportunities 
in the region for U.S. business and U.S. strategic interests 
in the region.  The Senator also met with the newly arrived 
Executive Director of APEC, where he took the opportunity to 
stress the need for Southeast Asian countries to improve 
transparency and rule of law, and to reduce corruption in 
order to attract significant new U.S. investment.  End 
Summary. 
 
----- The Meetings ----- 
 
¶2. (C) Senator Christopher "Kit" Bond traveled to Singapore 
for several meetings with Singaporean leaders, intellectuals 
and others on January 8.  The Senator was accompanied by 
professional staff members (Senate Select Committee on 
Intelligence) Louis Tucker and Gordon Matlock, along with 
Legislative Assistant for Foreign Policy Michael Dubois. 
During the course of the day, the Senator met with Minister 
Mentor Lee Kuan Yew, Prime Minister Lee Hsien Loong, Foreign 
Minister George Yeo, Asia Pacific Economic Cooperation (APEC) 
Executive Director Muhamad Noor Yacob, Ambassadors Ong Keng 
Yong and Tan Keng Jin, and professors Zheng Yongnian and 
Leonard Sebastian.  He also met with Internal Security 
Department Director Pang Kin Keong (reported separately). 
 
----- Promoting U.S. Business, but the Region Needs to Build 
an Attractive Environment ----- 
 
¶3. (C) The Senator assured his interlocutors that he was 
fighting hard to keep America from going down a path of 
protectionism, emphasizing his belief that maintaining free 
and open trade is especially crucial in a global recession 
and adding that the Southeast Asia region needed to do its 
part by also combating protectionism, addressing corruption, 
protecting intellectual property rights, and having 
institutions in place to provide for transparent business 
practices which respect the sanctity of contracts and 
agreements.  American companies are very interested in 
investing in the region and could potentially bring tens of 
thousands of jobs, Senator Bond explained, but will be wary 
of investing in countries where fair and reliable business 
practices are not in place.  Private U.S. investment is our 
best development tool, the Senator said, which could be 
leveraged to bring new technologies to the region and help 
develop small and medium enterprises.  He added that 
investment in the region promotes the United States' 
relationships and is a key to our long-term economic 
interests, and pointed to the Trans-Pacific Strategic 
Economic Partnership (TPP) as an excellent potential vehicle 
for a model trade agreement for the region for the future. 
Foreign Minister Yeo agreed on the importance of the TPP, as 
well as the hope that TPP negotiations will be completed by 
the time the United States hosts APEC in 2011.  Yeo noted 
that China would prefer a system of bilateral or regional 
agreements in which it could dominate its partners, while the 
TPP, on the other hand, would pull all of Asia along and 
would "keep everyone honest." 
 
¶4. (C) Numerous interlocutors expressed their appreciation 
for the Senator's commitment to free trade and to fighting 
protectionism.  Prime Minister Lee said the Singapore 
government has been trying to encourage American leadership 
on free trade, assessing that the Administration believes in 
free trade at heart but could be doing more to demonstrate 
it.  Citing two cases of anti-dumping measures the USG has 
taken on Chinese products, the Prime Minister suggested U.S. 
actions would be seen as protectionist. 
 
----- U.S.-Singapore Relations ----- 
 
¶5. (C) FM Yeo affirmed that Singapore and the United States 
share almost identical interests on all core foreign policy 
issues.  Minister Mentor Lee began his conversation with 
Senator Bond by saying Singapore has had a long relationship 
with the United States and "we know who are friends are and 
who are not our friends."  He described the "difficult 
position" the United States was in with regard to terrorism, 
noting that the USG position is to close Guantanamo Bay, 
however we are now faced with a dilemma of released prisoners 
potentially being involved in new attacks on the U.S., a 
problem exacerbated by connections to Yemeni terrorists 
 
SINGAPORE 00000102  002 OF 004 
 
 
stemming from the December 25 attempted bombing of a 
Northwest Airlines jet.  The USG "may have to do a U-turn" or 
get blamed for a possible future attack, MM Lee surmised, 
adding that President Obama could tell the American people 
that having been presented with new facts since the campaign, 
he had to change course.  MM Lee also described Afghanistan 
as a major problem facing the United States, noting the 
treacherous nature of Afghan fighters and the fact that 
history was full of armies who had been defeated in 
Afghanistan.  He hoped the United States would not pull its 
troops out of Afghanistan before the security situation was 
stabilized, even if that meant going beyond the stated plan 
of beginning withdrawals in 2011. 
 
----- Outlook on Indonesia Darkening ----- 
 
¶6. (C) Several interlocutors gave gloomy assessments of the 
recent path Indonesia was taking.  Foreign Minister Yeo 
agreed with the Senator that corruption was a major obstacle 
to overcome in Indonesia and said that Singapore businesses 
have also suffered from this cause.  Professor Sebastian went 
as far to say that Indonesia's institutions are "rotten to 
the core," and suggested that the way forward was through new 
institutions, citing the Constitutional Court as a promising 
example.  Sebastian said President Yudhoyono's (SBY) 
government lacked a Jusuf Kalla figure -- someone with the 
political skills to take aggressive action to advance 
government reform -- and added that the United States should 
be urging SBY to think about his political legacy and to 
focus on combating corruption in Indonesia.  Prime Minister 
Lee encouraged Senator Bond to discuss corruption directly 
with SBY, but said he wasn't sure Jakarta would be able to 
implement necessary basic changes; while SBY wants to go down 
as the greatest president in Indonesian history, reforming 
corruption is "beyond his powers," the Prime Minister said. 
Minister Mentor Lee described the quandary SBY faced over a 
couple current corruption scandals in his government and 
expressed his disappointment that the controversy would 
likely prohibit SBY from achieving the reforms that would be 
necessary to fundamentally change Indonesia's investment 
climate. 
 
----- Vietnam: Most Promising ----- 
 
¶7. (C) Asked by the Senator what is the most promising 
country in the region, the Minister Mentor quickly pointed to 
Vietnam.  He told a story of his own counseling of Vietnamese 
leaders in the 1990s, where he said the key to market reform 
was to stick to promises and to not change halfway.  While 
Vietnam's upper echelon still has the guerrilla mindset of 
the past generation, the younger Vietnamese are learning an 
open market system and slowly Vietnam has begun to change, he 
said.   Vietnam also respects intellectual property rights 
and the sanctity of contracts, the Minister Mentor stated. 
Prime Minister Lee said that while Vietnam is not as cohesive 
as China, Singaporean investments are doing quite well in the 
country.  He added that while Prime Minister Dung is a 
reformist, the corruption that is inevitable when introducing 
an open market has left the reformists vulnerable to attacks 
from conservatives.  Professor Zheng and Ambassador Ong 
agreed that Vietnam is concerned about increasing Chinese 
influence in the country and Zheng noted Hanoi is 
particularly wary of China's development of Hainan as a 
center of tourism due to the island's proximity to 
controversial areas in the South China Sea. 
 
----- Thailand in Trouble ----- 
 
¶8. (C) Thailand's image has been badly tarnished in recent 
months, and the question of succession of King Phumiphon 
poses additional challenges for the country, several people 
told Senator Bond.  Minister Mentor Lee believed the Queen 
was fooling herself if she believed she could control the 
Crown Prince as king, adding that former President Thaksin 
had influence over the Crown Prince and a score to settle 
with several generals.  Foreign Minister Yeo also predicted 
trouble when King Phumiphon passes, citing Thailand's 
"puerile" political institutions for which the King has set 
himself up to be the ultimate arbiter -- institutions which 
will have difficulty coping with an unpopular new king. 
 
----- China and India and the Battle for Regional Influence 
----- 
 
¶9. (C) Minister Mentor Lee described the most important trend 
in the region as being the growth of powerhouses China and 
India, noting that Singapore is at the crossroads of their 
battle for influence so can benefit from the competition. 
 
SINGAPORE 00000102  003 OF 004 
 
 
The strength of both China and India's economies contributed 
to Singapore being able to bounce back quickly from 
recession, he said.  Foreign Minister Yeo said that the rise 
of China means that all of Southeast Asia ants the United 
States and India to play a bigger role in the region.  He 
said that Singapore favored including India in the East Asia 
Summit (along with Australia and others) to counterbalance 
China, but cautioned that regional players must handle the 
Indians in a thoughtful way, characterizing them as having a 
"strong amour-propre."  Ambassador Ong said that all 
Southeast Asian countries are concerned about China's new 
assertiveness; the "charming phase of Chinese diplomacy 
toward the region is over, he believes, and China is becoming 
more assertive in both diplomacy and business.  Discussing 
the United States relations with the region, FM Yeo expressed 
the belief that Japan under and Ichiro Ozawa-led DPJ will try 
to improve relations with China, but will not shift too far 
from the United States.  "In the long term, Japan will be a 
more reliable partner (for the United States) than South 
Korea," he stated. 
 
----- U.S. Engagement with Burma Welcomed, Patience Urged 
----- 
 
¶10. (C)  Foreign Minister Yeo said all ten ASEAN countries 
welcomed the U.S. move to engage ASEAN comprehensively, 
noting the relationship had previously "foundered on the rock 
of Myanmar."  While acknowledging that Burma is still a 
serious issue, FM Yeo said there is now hope that the Burma 
problem will no longer be the defining issue for the region 
in American eyes.  FM Yeo cautioned against any expectation 
of near-term political opening in Burma.  Although Burma's 
2010 election will bring in a new government, the generals 
will certainly retain their power, even if Aung San Suu Kyi 
is given the opportunity to play a political role, he said. 
Both FM Yeo and MM Lee described Singapore's long-term view 
of Burmese political development, expecting little in the 
short term.  Rather, Singapore looks forward to generational 
change, with MM Lee noting "They (the junta's leadership) 
will die sometime" and FM Yeo saying "people get old, people 
die, things happen."  MM Lee said many of the junta's leaders 
come to Singapore for medical treatment, and that Singapore 
"has a good idea" of who are the ailing ones.  FM Yeo added 
that Burma does not want to be too close to China, and that 
while Burma has opened itself up to infrastructure projects 
from Beijing, it has also courted similar projects from India 
and ASEAN in an effort to keep its strategic options open. 
FM Yeo cautioned the U.S. not to push Burma in "the wrong 
direction." 
 
----- Malaysia's Competing Dangers ----- 
 
¶11. (C) Prime Minister Najib faces danger from three internal 
sources according to Ambassador Ong: Islamists, the 
democratic opposition, and Malay ultra-nationalists.  In 
order to accomplish anything, Najib has to manage all of 
these groups, he said, and the groups are consciously 
leveraging their position to demand more from the national 
government.  Ambassador Tan agreed with Ong's assessment and 
added that the Prime Minister and opposition parties were 
trying to "out-Islam" each other in an appeal for popular 
support.  Minister Mentor Lee said that race politics have 
created a divided society, citing divisions between urban and 
rural Malays, manifested most recently in the "rampage" by 
Muslims over the use of the word "Allah" by non-Muslims.  PM 
Najib is attempting to position himself to be seen as the 
defender of Islam, the Minister Mentor opined. 
 
----- APEC Executive Director: Team Building and Focus on 
Core Mission ----- 
 
¶12. (C) Senator Bond stressed the importance of free trade 
and investment liberalization, to include expansion of the 
TPP, with Ambassador Muhamad Noor Yacob, the Executive 
Director of the APEC secretariat.  Ambassador Noor, who had 
just assumed office on January 4, expressed thanks to the 
U.S. for its many various contributions to APEC.  His 
immediate emphasis will be to instill a sense of team and 
teamwork in the secretariat, with a longer term focus on the 
organization's core mission of trade and investment 
liberalization.  The Senator and Ambassador Noor agreed on 
the benefits of agriculture technology in addressing food 
security, as well as technology driven solutions for greener 
ways of producing energy, with Noor noting that Japan, as 
host of APEC for 2010, was highlighting 'knowledge-based 
growth."  Senator took the opportunity to stress the need for 
Southeast Asian countries to improve transparency and rule of 
law, and to reduce corruption in order to attract significant 
 
SINGAPORE 00000102  004 OF 004 
 
 
new U.S. investment. 
 
¶13. (U) Codel Bond has cleared this message. 
SHIELDS 
 
Visit Embassy Singapore's Classified website: 
http://www.state.sgov.gov/p/eap/singapore/ind ex.cfm