Speech by Minister for Home Affairs and Minister for Law Mr K Shanmugam SC at UNCITRAL Academy Conference, Singapore Convention Week 2022
30 August 2022 Posted in [Speeches]
Friends and colleagues
Ladies and gentlemen
- Good morning.
- Welcome to the UNCITRAL Academy Conference.
- We welcome and thank those who have come from far. I welcome UNCITRAL Secretary Ms Anna Joubin-Bret and her colleague Ms Judith Knieper, speakers and moderators, partners and friends. This is the second time we are co-organising the UNCITRAL Academy Conference with UNCITRAL.
- This year’s theme is “Embracing Global Change, Navigating New Possibilities”.
- We have talked about COVID-19 for two years, the war in Europe. These have had a deep impact over the past two years. And it continues to have an impact.
- We are looking at slow growth, high inflation. According to IMF in July this year, growth this year would probably be half of what it was last year - 6.1% last year, 3.2% global growth this year. And next year, it is likely to be even less, at 2.9%. Europe is expected to grow at 2.6% this year, US at 2.3%, ASEAN - slightly better at 5.3%. Inflation has at least doubled, in 37 out of 44 advanced economies over the past two years.
- This morning’s Financial Times headlines was on Europe trying to decouple electricity prices and gas prices. How that is possible, I am not sure. The only way is by state subsidy. And state subsidy, or European subsidy, and the impact on consumption – there are going to be very interesting questions.
- So there are real-life issues that affect economies, businesses, individuals. Gas prices have gone up by 10 times, so you can understand the political implications and the need to come in and help.
- At the same time, businesses have been impacted by a confluence of factors. There is, oddly enough, increase in consumer demand. At the same time, there have been supply constraints because production capacity is not yet fully back to pre-pandemic levels. You have disrupted supply chains with product shortages and the fuel cost increases we spoke about. Businesses are struggling to find workers, and the conflict in Europe, with Russia being a major supplier of oil, gas and metals, and Ukraine a major supplier of wheat and corn.
- Together with the geopolitical tensions between US and China – I think many countries as well as businesses are beginning to rethink their dependence on other countries. They are trying to reconfigure their supply chains. They are placing greater emphasis on resilience, and not just efficiency, to really withstand external shocks. And often, that has meant turning inwards.
- Multinational corporations are re-shoring production back home. According to Reshoring Initiative, which is an industry organisation, the reshoring initiatives are expected to bring back nearly 400,000 manufacturing jobs to the US this year alone. There will be a tendency to stockpile inventories of critical components. That is going to intensify competition for materials, probably leading to more price increases.
- So it is a very uncertain environment, no one is really able to predict how it is going to look like in the next six months, one year. Globalisation as we knew it has obviously suffered a setback. In this environment, countries have to work even harder to try and come together, to keep to what is possible in terms of cooperation, and try and keep the global trading environment as healthy as possible. Some of these trends – on reshoring, on supply chain resilience, on relying on oneself, they are not going to go away anytime soon. So, the environment is going to be different.
Singapore Convention on Mediation
- In this context, in particular now, UN and UNCITRAL have to play an even more important role, because it can easily become very fractured. I think there is a need for credible international organisations like the UN to provide a framework for international cooperation, to help in harmonising actions of nations. Where possible, countries with a similar outlook – Singapore is one of those countries – have to try and support the global trading and working environment; try and create more international structures. So we speak with the US, with China, we try and bring different countries together, to try and put together a more harmonised environment. It is not easy, but we are going to keep trying.
- At UNCITRAL, in particular because you promote progressive harmonisation and unification of international trade law, the thing is, you got to make sure you do, you try, that the rules are agile - to reflect these new realities and demands.
- We in Singapore have been a staunch supporter of the UN and what UNCITRAL stands for. We recognise the importance of upholding rules-based multilateralism.
- The Singapore Convention on Mediation is a step in this path. It was a powerful statement in support of multilateralism. When it opened for signature in Singapore in 2019, we had 46 countries signing it immediately, which I am told is the highest number of signatories on the first day for a UN convention.
- Since then, there has been progress. The Convention has entered into force on 12 September 2020. We need more countries to come onboard and ratify.
- This year we are also focusing on mediation in this Conference. We have put it forward, as an alternative dispute resolution, which is relatively faster, cheaper, more flexible, and something that helps preserve business relationships, which is probably even more important in today’s landscape, which is more fractured.
- The Singapore Convention on Mediation provides businesses with greater assurance that their mediated settlement agreements can be enforced cross-border. That is one of the main advantages. Much to think about, in terms of the global environment, legal environment, disruptions. A lot of think about in terms of what role mediation can play.
- I wish you all a very fruitful conference. Thank you.
Last updated on 30 August 2022