The US and China are absolutely critical, and they're critical both in areas of traditional security concerns.

They're critical when it comes to nuclear, and they're critical when it comes to security from AI driven warfare.

Hello, and welcome to GZERO World.

I'm Ian Bremmer and I'm coming to you from Davos, Switzerland, where I've been meeting with heads of state and business leaders and all the other totally normal people who gather here each year at the World Economic Forum.

And today's conversation is with one of the most interesting leaders I ran into this week, Singapore's President Tharman Shanmugaratnam.

Because if it was geography that made this Southeast trade hub rich, it's geopolitics that will determine its fate in the 21st century.

And right now, things are a little awkward.

Singapore is a close friend and security partner of the United States, but its economy is also heavily dependent on China.

And for a small country at the center of global trade, managing that tension is a matter of survival.

And yet Singapore has continued to thrive as a hub for finance and technology and cutting edge AI, all under a famously strict governing model.

Oh, and the food is amazing.

I talk about all of that and more, though maybe not the food, with Singapore's president.

Don't worry, I've also got your puppet regime.

So you want to overthrow a government next door, but you also know your people don't want big wars.

But first, a word from the folks who help us keep the lights on.

Funding for GZERO World is provided by our lead sponsor, Prologis.

Every day, all over the world, Prologis helps businesses of all sizes lower their carbon footprint and scale their supply chains.

With a portfolio of logistics and real estate and an end-to-end solutions platform addressing the critical initiatives of global logistics today.

Learn more at Prologis.com.

And by Cox is proud to support GZERO.

The planet needs all of us.

At Cox, we're working to seed the future of sustainable agriculture and reduce plastic waste.

Together, we can work to create a better future.

A family of businesses.

Additional funding provided by Carnegie Corporation of New York.

Koo and Patricia Yuen, committed to bridging cultural differences in our communities.

And... ♪ There's nothing Singaporeans hate more than a mess.

Littering can cost you up to $1,500.

Chewing gum is tightly restricted to medical, yes, medical use.

No, I don't know what that means.

Even failing to flush a public toilet can earn you a fine.

It's all part of a system that treats cleanliness not as a suggestion, but as a civic obligation.

And it's a lesson that made global headlines back in the 1990s when one American teenager found himself on the wrong side of a bamboo cane for vandalizing some parked cars.

Hit it Weird Al Once there was this kid who took a trip to Singapore and brought along his spray paint and when he finally came back he had cane marks all over his bottom.

But some messes are harder to clean up than others and today Singapore finds itself mired in a geopolitical muddle between its two most important partners.

On the one side, a United States hell-bent on upending decades of globalization with trade wars and tariffs.

And on the other, a rising China only too happy to reshape the global order in its own image.

But I'm getting ahead of myself because Singapore, you have to first understand, is a bit of a miracle.

Long before the skyscrapers and the sovereign wealth funds, geography determined Singapore's destiny.

Small island nation sits on the confluence of the strategically vital Malacca Strait and South China Sea, and it has served as a vital trading post since as early as the 13th century.

When the Suez Canal opened back in 1869, Singapore became the key refueling stop, the key warehouse, and the key economic broker between East and West.

And yet Singapore's current wealth was far from certain.

For much of its modern history, it was a small colonial outpost ruled by Britain, then brutally occupied by Japan during the Second World War.

When it became independent in 1965, the ethnically divided and resource-scarce country was poorer by per person GDP than South Africa or Jordan.

But today, Singapore's per capita wealth is among the highest in the world, beating out the United States, Hong Kong and Britain.

Much of this success was thanks to its first Prime Minister and longtime leader, Lee Kuan Yew, who pushed for radical openness to global trade and foreign investment, especially from the United States, also supported multinational corporations.

He paired this economic openness abroad with a highly controlled political system at home, establishing a soft authoritarian rule under a dominant party that persists to this day.

It's a socioeconomic bargain that has mostly paid off for its six million citizens, because as the world has gotten richer, so too has Singapore.

But in recent years, that rising tide has turned choppy.

Here's Singapore's president speaking at the IMF late last year.

Multilateralism and the belief in the mutuality of nations is at its weakest in 80 years.

At the very stage when it is needed most.

In an era of increasing economic uncertainty and geopolitical competition, smaller nations find themselves being forced to pick sides.

But for a country like Singapore, whose very existence depends on not picking sides, that's a real problem.

Joining me to talk about how Singapore is navigating a global order of rising nationalism and plummeting trust is its president you heard from a moment ago, Tharman Shanmugaratnam.

Here's our conversation.

President Tharman Shanmugaratnam, it's so nice to see you.

Wonderful to see you, Ian.

This is not our first rodeo here, but it does feel like it's the most uncertain, the most disruptive.

Would you agree with that?

Well, I think by any objective assessment, this is a moment in global history where all the old verities are now past us.

And we don't know where we're heading to.

In other words, this is not a transition to some new world order.

It's certainly not a transition to multi polarity, a term that's bandied about, but suggests some, some semblance of balance and some semblance of shared responsibility.

We're not anywhere close to that.

All we have is a way no longer in a world where a single dominant power oversaw global security, open global markets, and global public goods.

We're no longer in that world.

And we don't know what replaces it.

What we do have very salient is uncertainty.

Radical uncertainty.

We have fluidity in international affairs.

Transactions occurring by the day.

And we keep waiting for the next hotspot.

So that's where we are at.

But it means the task for countries large medium and small.

Is not to sit back and be intimidated.

Not to be dispirited.

But to now construct.

A decent world order.

Where you have a framework of rules that still respect sovereignty.

That allows us to address the common issues that all countries are interested in.

Are self-interested in.

In other words, they are major issues.

Which are not merely global issues.

Not merely issues that attract globalists.

But attract every country in its own interests.

And our ability to collaborate on those issues is going to be critical to satisfy the well-being of our own people.

So we've got to construct that new world order.

Or I would say we've got to construct multiple alliances of the willing, coalitions of the willing, that enable us to address these issues, even if we're not going anywhere close to that old world order that we knew.

Now, I agree with everything you just said, in the sense that we have enormous uncertainty, that so many countries, so many people around the world want something that feels like a rules-based order and it needs to be constructed, essentially.

But of course, at the same time, we have the United States, which is driving the disruption, not just by saying it doesn't want to play the global leadership role, but actually sort of undermining a lot of the rules that otherwise a country like Singapore would like, whether it's the geopolitical actions in Venezuela or Greenland, or it's the economic actions in terms of the tariffs and the interventions.

China's been doing that, maybe not as suddenly, but we've seen that in the South China Sea, we've seen it in Taiwan, we've also seen it in terms of state capitalism.

So, add that to your equation, what the Americans and the Chinese are doing.

Well, the vast majority of countries, partly as a consequence of the 30 years of multilateralism that we've had, the vast majority of countries believe in the international rule of law, believe in open markets and are now wanting to do more to liberalise their own markets and strike up alliances, and believe that there's something in climate change and global health and the new risks of AI where cooperation will leave us all better off.

The vast majority of countries believe in that and they are moving.

They're moving and this may be a... So you're saying the vast majority but not the most powerful.

That's the bit that I'm not hearing.

That is true for now.

I'll come back to that because it may not be a permanent state of affairs.

The vast majority, also now, and this may be a blessing coming out of the current state of disorder, are now moving a lot faster to develop new alliances, new coalitions, in ways that I would not have expected five years ago.

There's so much inertia in the system, not just bureaucratic inertia, but political inertia.

And that's now dissipating precisely because of the urgency of the moment, precisely because everyone is now having to sit up and realise that we have to exercise agency.

And we exercise agency among small countries, medium-sized countries and some large countries.

Most of the largest problems in the world no longer require leadership by a single dominant power, but they require enough of a solid core of countries comprising enough of world trade, enough of world carbon emissions, enough of world expertise and technological innovation so as to be able to provide a new foundation for some form of multilateralism that will no longer be singular, will probably be multiple and organized by domain.

So you'd surely put the EU-Mercosur deal in that category.

It's a good example because how long were they working on it?

Decades probably of 30 years.

It got going very quickly after April the 2nd.

After liberation.

The CPTPP is now talking to the EU, very serious conversations.

It'll take some time but they're serious workman-like conversations.

ASEAN is moving faster and ASEAN is also getting involved in discussions with CPTPP and that's in trade.

But in other areas too, in global health, on everything to do with the climate and increasingly, and this is the area where we are least prepared, developing some form of global governance around AI so as to maximize and unleash the gains that it's potential, that it's potentially capable of giving countries, including developing countries, whilst guarding against its worst risks, is going to be critical.

Yeah, I want to get to that.

But before we get to AI, you mentioned we've got these areas, you mentioned a number of them, compelling areas where we're seeing all sorts of additional trade rules of the road and economic rules of the road because there are lots of countries that together are meaningful in being able to put, to construct that.

Right.

If I look at security, I see much less of that.

Right.

Because the global economy looks like a global order that has a whole bunch of countries that are really relevant.

Right.

I don't see that in the security space.

Are you necessarily much more pessimistic in the ability to create governance and collective security in that environment given the consolidation of power around a much smaller number of countries that aren't necessarily as willing to hedge the way that you are suggesting?

I think the key will be US and China.

Europe has already shifted its posture on security as a matter of necessity.

Towards Ukraine you mean?

Ukraine as well as some other potential new threats.

The US and China are absolutely critical and they're critical both in areas of traditional security concerns.

They're critical when it comes to nuclear and they're critical when it comes to security from AI-driven warfare.

I think it is possible for the US and China to come to some form of understanding where they will continue to be rivalrous, continue to be intense rivals in the economic sphere, even in AI, whilst exercising restraint in others, and even collaborating in some fields, because it will be in their common interest.

Most obviously, to take the example you've given, both the US and China want to rule out AI-driven nuclear warfare.

The one area that they've actually spoken together on AI.

They can also move further in AI to rule out some of its worst dangers.

I think it involves a shift in mindset, both amongst the leading private sector players as well as governments, around thinking about who's going to win the AI race.

There is no one AI race.

There are several AI races.

There's foundational research, there's implementation and implementation in a whole set of different domains, from healthcare to robotics and factories to many other areas.

There's about standards and the dissemination of standards globally, which then get countries to buy into your AI stack versus someone else's.

There's a whole set of races, and it is most unlikely that either the US or China is going to win an AI race.

That should lean us towards thinking about a framework in which they continue to compete, but they actually find ways in which you can get win-win.

You can get collaboration in AI that strengthens its productivity potential, that spreads the solutions that are being used in some areas, whether it's drug discovery or some other areas, spreads them as widely as possible at a low cost, rather than develop whole AI stacks that are separate from each other.

It's a classic case of the benefits of interdependence, but now magnified quite greatly by an era of AI.

So do you think that on AI governance and collaboration, is the biggest challenge right now that it's just too fast moving?

Is the biggest challenge that the companies are making so much money and they've captured the regulatory process that the governments are incapable of even starting to consider it?

Is it the lack of trust between the US and China that's disentangled, the researchers from talking to each other, working for each other?

How do you order the challenges?

Because I completely agree with you that it's the hardest area right now that's most essential to get cooperation.

I think you summarized it well.

It is quite different from the remarkable packs that were arrived at during the Cold War between the US and the Soviet Union.

It's quite different from reaching nuclear arms control.

First, because it's not being developed or monopolised by states, but by the private sector.

It's moving very fast, much faster than states are capable of comprehending.

But I think it's, and also the fact that whilst you can count nuclear warheads, it's much more difficult to count algorithms and the manifold effects of algorithms.

But I think if we are realistic about how we go about this, if we are realistic in wanting to control the worst, to guard against the worst that AI could bring, something can be achieved.

We gave the example of nuclear war and making sure that AI is not in control.

But in many other areas, the risks of runaway misinformation, the risks of cyber warfare, not I don't mean in the security domain, but in many other areas, there's common interests.

There's enough common interest to rule out the worst while you compete over the best.

And there's enough common interest also in disseminating as widely as possible the productivity improvements that come from AI, so that the market grows for all the dominant powers in AI.

And I would just say that whilst the US and China are critical in this, small countries and medium-sized countries are part of the game.

They've got to be at the table, because sometimes it's the most vulnerable countries that are the first to want to institute guardrails, and the major powers eventually come on board.

So, Tharman, one of my favourite quotes is from William Gibson, the author.

He says, "The future's already here, but it's not evenly distributed."

When we talk about AI, Singapore has been one of the most technology-forward countries in the world.

Advanced industrial economy, six million people-ish, 60% diffusion of AI.

How do we, if we look at Singapore as near future in that regard, how do you experience AI differently in your country than a lot of other countries do?

What are you already seeing happening in the way the government works and the way society functions?

Right.

Well, every city or economy or firm that's more exposed to AI is going to face a challenge.

We will face the challenge faster than some countries which don't have the basic digital infrastructure, which is going to be a problem for them because they're not going to be able to take advantage of AI as much.

But we will face the challenge quicker.

Our advantage, however, is that we always face the challenge faster than other countries because we are small, we are very open, and we rely on technology as a source of competitiveness.

So we look at AI, like every other form of productivity improvement as a plus.

And the real challenge is that we want that plus to be distributed up and down the workforce.

That is going to be a challenge everywhere in the world.

And it's not obvious that we are going to succeed.

It requires very active public private partnership.

We always knew that when we talked about skills upgrading skills continuous skills training.

But it's going to be much more of a priority in the future.

And it's going to be more important than ever before.

Because I think if you think about about this challenge, not as a threat from a new technology, but you think about it as a challenge of how do you maximize human capital?

How do you achieve mass flourishing of a society?

It's actually something on the supply side.

It's about something you do to build up people's capabilities.

If you build up people's capabilities, something works out.

Something works out.

It works out for them and it works out for your whole economy.

You manage to move on to a new phase of competitiveness.

So focus on capabilities, even if you don't go about it by way of traditional industrial policy, trying to get an exact matching of demand and supply, and thinking you can predict the future.

If we look forward in five years, is the Singaporean government going to be as powerful in Singapore, or are private sector companies going to be a lot more influential?

Well, you know, our whole model of economic policy in Singapore was quite different from the traditional model in Northeast Asia, for instance.

It was always a model of watching the market, following the market, and allowing the market to work better and faster.

So our whole industrial strategy, our whole economic strategy, consisted of talking to leading companies, local and foreign, finding out what their plans were for the future, and then saying, let's try and create an ecosystem to make this happen faster and make sure that workers can benefit.

So we were always involved in ecosystem building.

That's what the government was about.

It was never about government versus private enterprise.

It was about creating ecosystems where private enterprise can do well for itself, but most importantly, where our people can be part of the prosperity.

President Thurman, Shanmugaprabha, it's always good to see you.

Thank you.

Thank you, Ian.

And now for something that I'm sure would not fly on the streets of Singapore, I've got your Puppet Regime.

So you want to overthrow a government next door But you also know your people don't want big wars Just call it something else, something everyone knows it isn't Improper glow of gaslight, no one can tell difference Well, it walks like war and it quacks like war Sounds like so much less, but it's so much more Once you line up all your tanks, your jets, your drones, and all your vessels You've got to pull the trigger, you deserve to be special Launch your special military operation Special military op-op-operation It's not invasion of another sovereign nation.

It's kind of a bop.

I am, I am, I am Shake booty on floor, get boots on ground Special operation is going down Shake joba on floor, get boots on ground Special operation is going down Been way long time, I like the sound I might get special with Taiwan now I'm on a road, totally unbound Maybe I'll just grab Greenland now >Everybody >Gets >Their >Own Special Military Operation Special Military Operation It's become an international sensation Special Military Operation Puppet Regime That's our show this week.

Come back next week.

And if you like what you've seen, or even if you don't, but you want to create your own economically vibrant but politically restricted city-state, you've come to the right place.

Check us out at gzeromedia.com [music] Funding for GZERO World is provided by our lead sponsor, Prologis.

Every day, all over the world, Prologis helps businesses of all sizes lower their carbon footprint and scale their supply chains.

With a portfolio of logistics and real estate, and an end-to-end solutions platform, addressing the critical initiatives of global logistics today.

Learn more at prologist.com.

And by Cox is proud to support GZERO.

The planet needs all of us.

At Cox, we're working to seed the future of sustainable agriculture and reduce plastic waste.

Together, we can work to create a better future.

Cox, a family of businesses.

Additional funding provided by Carnegie Corporation of New York.

Kou and Patricia Ewan, committed to bridging cultural differences in our communities.

And...