SINGAPORE (BLOOMBERG) – The US presidential election result may still be in doubt, but whoever emerges victorious will need to unite the country to adapt to the challenges of globalisation and digitisation or risk a backlash so severe it could damage the global economic system, Singapore’s Trade and Industry Minister Chan Chun Sing warned on Thursday (Nov 5).

Without such a shift, “there will be a pushback against globalisation and the world economic system may fracture or fragment because of that”, Mr Chan said in an interview with Bloomberg Television’s Haslinda Amin.

“One of the biggest challenges for the US going forward is how can it maintain its leadership in the world by mobilizing like-minded partners to work together to uphold and update the global economic and security order,” the minister said.

Mr Chan’s comments come with Democratic candidate Joe Biden closing in on the 270 Electoral College votes needed for the presidency and incumbent Donald Trump filing legal challenges to stop ongoing vote-counting in several states.

The results show the US electorate is “almost split down the middle”, Mr Chan said later on Thursday in a roundtable with Bloomberg.

Aside from the US vote, Mr Chan said Singapore is being impacted by the resurgence of Covid-19 infections overseas, which has triggered successive lockdowns with a ripple effect on the city-state’s trade-reliant economy.

He warned that Singapore’s economic recovery would be “gradual and uneven”, echoing an assessment last week from the Monetary Authority of Singapore. The country’s overall unemployment rate climbed in the third quarter to its highest level since 2004.

POST-COVID REALITY

While China’s resurgence from the initial virus outbreak offers some support to the global economy, “China alone will not be able to do miracles for the world”, he said.

The trade minister said China will need to rebalance its own economy alongside other countries and grapple with a host of challenges, such as managing uneven development across the country, securing supply lines and focusing on their resilience, and managing an aging and diverse population.

Businesses increasingly are accepting that some things have changed structurally since the pandemic, he said. About half of Singapore businesses Mr Chan has spoken with now agree there will not be a return to the “pre-Covid world”, versus about 20 per cent three months ago, he said.

“Many companies are rethinking their entire global production footprint”, and even companies that are doing well, as in the semiconductors industry, are adjusting, Mr Chan said.

In the long- to medium-term, such adjustments post-Covid are “a net plus for Singapore, for a country without natural resources”, he said, allowing it to “transcend our geographical size and geographical location”.

“The question is really how connected we are with the rest of the world,” he said.