Is the USA Still in Pole Position?

Irrespective of the global backwash effects emanating from the toxic sub-prime fall-out, Lee Kuan Yew (LKY) still believes the US continue to be the sun of the world's political economy and other economies including China will still have to gyrate in its orbit.

Agreeing that the road to global recovery may come from Asia, LKY believes that the US continues to hold the key to a firm, solid global recovery. According to LKY, the US will still be the top superpower for the next 80 years and although China persists in its economic expansion path, it knows that it is in “no position to currently challenge American supremacy.”

He says that with China and India looking to achieve 8 and 6 per cent growth respectively in 2009 despite the downturn, the world’s economy was certainly shifting from “the Atlantic to the Pacific” for the time-being. As such, these two economies should play their roles meaningfully, in consonance with others particularly the US,to expedite global economic recovery.

LKY also cited China’s “deep pockets” and determination to capture a larger market share despite incurring losses on the way as the reason why it would continue to become stronger.

Lee added that China, with a population of 1.3 billion, learns quickly from others like Singapore. He concedes that it is indeed “scary” for any economy to compete with China.

According to LKY, military-wise,the US would continue to be the most powerful nation in the world for the rest of the 21st century and he opines that East Asian nations would need American military support and protection to maintain law and order so as to be able to progress.

He added for the moment, China has little choice but to cooperate with the US on the road to economic recovery, as it had over US$800 billion (RM2.8 trillion)in US Treasury bonds in reserve. As such, it pays for China to support any or all US efforts to bring about an earlier global economic recovery.

LKY also saw President Barack Obama as a capable leader that can confidently lead the US on the road to recovery. Adding that since Obama has a strong team around him, the US president should “concentrate on the economy, the economy and the economy”.

So much for the insights of a man that brought Singapore into the ranks of one of the most developed economies of the world.

We hope he is right.