Singapore, Asean have to be proactive to stay relevant in volatile world: Chan Chun Sing

SINGAPORE, 7 AUGUST 2026 —

KUALA LUMPUR — Singapore’s Coordinating Minister for Public Services and Minister for Defence, Chan Chun Sing, has underscored the need for proactive measures to maintain the city-state’s—and ASEAN’s—competitiveness amid rising geopolitical and economic uncertainties.

Speaking at the 18th ASEAN & Asia Forum organised by the Singapore Institute of International Affairs (SIIA) on Monday (Aug 3), Chan highlighted that energy, finance, and data are the “commanding heights” of the new regional economy. He stressed that Singapore’s competitive advantage must be continuously cultivated rather than assumed, as no single factor can guarantee long-term relevance.

“Competitive advantage is something that we have to constantly seek and work on,” Chan said. “There is no single panacea that will give us eternal competitive advantage.”

The minister noted that Singapore’s small domestic market means its appeal lies in its ability to deliver value and connectivity globally. Without relevance and bargaining power, he warned, the country risks being “squeezed” in an increasingly fragmented world.

Policy Consistency as a Key Driver Chan emphasised that policy consistency is critical in attracting long-term investments, particularly in capital-intensive sectors such as energy, semiconductors, and biopharmaceuticals, where returns may take years to materialise. Investors, he said, favour destinations with predictable policies and execution over the long term.

This approach, he added, could extend to the broader ASEAN region, where cooperation in energy, finance, and data could transform the bloc from a collection of separate markets into a cohesive economic bloc.

“With several ASEAN countries having strong access to renewable energy sources, the region has the potential to become a major producer of cleaner power,” Chan noted. “Meanwhile, strong and integrated financial and data infrastructure are essential to reducing friction in doing business.”

Private Sector-Led Growth Over Government Intervention While regional cooperation is vital, Chan cautioned against over-reliance on intergovernmental initiatives. Instead, he advocated for private-sector-driven “bankable projects” that make economic sense, even if they are not initially designed for regional integration.

“In fact, I would be cautious if governments start to intervene, because you need a certain market discipline for investments to flow,” he said. Governments, he argued, should instead focus on providing a “foundation of certainty” to instil confidence in investors.

Chan cited the ASEAN Power Grid as a key infrastructure project that could secure the region’s energy needs and underpin future development.

Challenges in Financing Long-Term Projects During a panel discussion titled “ASEAN’s Competitive Future Amidst Trade Turbulence”, experts highlighted the difficulties in financing long-term projects amid global volatility.

Dr. Ludger Schuknecht, Vice-President of Policy and Strategy at the Asian Infrastructure Investment Bank (AIIB), noted that multilateral development banks can play a crucial role in mobilising private and blended financing for projects with long-term returns. These institutions not only provide funding but also enhance investor confidence by offering clarity on timelines and standards.

“Regional countries, including Thailand and Vietnam, have become increasingly willing to work with multilateral development banks in recent years,” Schuknecht said.

Strengthening Financial Infrastructure Through Regional Collaboration Kevin Wong, Chief Executive for Asia-Pacific at global financial messaging network Swift, echoed the need for clear roadmaps at both national and regional levels to attract long-term investment. He pointed to Project Nexus, a multilateral effort to connect ASEAN’s domestic instant payment systems, as an example of regional collaboration that reduces friction in cross-border transactions.

“Regional collaboration is important to design these road maps and think about the additional risks and frictions that may come along,” Wong said.

Avoiding ‘White Elephant’ Projects SIIA Chairman Simon Tay, who moderated the panel, warned against funding projects that lack economic viability, describing them as “white elephants” that drain capital without delivering returns.

“There is a lot of money out there, but the ability to mobilise capital is not easy,” Tay said. “The markets cannot supply where there is no demand.”

He called for a “new discipline” in funding development projects, balancing the need to attract private capital with the role of philanthropic and blended finance in supporting strategic but lower-return initiatives.

Malaysia and ASEAN: Navigating the Path Forward For Malaysia, a key ASEAN economy, Chan’s remarks underscore the importance of maintaining policy stability and fostering private-sector-led growth to attract investment. The country’s push for renewable energy and digital infrastructure aligns with the broader regional focus on energy, finance, and data as economic drivers.

Regional initiatives such as the ASEAN Power Grid and Project Nexus could also benefit Malaysia, particularly in enhancing energy security and financial connectivity. However, experts stress that success depends on avoiding unbankable projects and ensuring that government interventions do not distort market dynamics.

Looking Ahead: A Balancing Act As ASEAN grapples with global uncertainties, the region’s ability to stay relevant will hinge on its capacity to adapt, innovate, and collaborate. Chan’s emphasis on proactive measures, private-sector leadership, and robust infrastructure reflects a broader strategy to future-proof the bloc’s economy.

Yet, the challenge remains: balancing regional cooperation with national priorities while ensuring that investments yield tangible returns. With geopolitical tensions and economic volatility persisting, the path forward will require both strategic foresight and disciplined execution.

on specific policy adjustments or new initiatives Malaysia or other ASEAN nations may announce in response to these discussions. — Ends —

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