Singapore Leader: Face Economic Realities

IN the global community now emerging after the collapse of communism in Eastern Europe, political hopes cannot be divorced from economic realities, according to Singapore leader Lee Kuan Yew. The country's long-serving prime minister, interviewed in London, offered a typically hard-headed assessment of the challenges in helping Eastern Europe emerge from over four decades of stagnation.

To illustrate his theme he mentioned the famous Gdansk shipyard in Poland, birthplace of the Solidarity trade union, and now in deep economic difficulty.

``I feel sad for Americans who believe they can save the Gdansk yard. They have not understood the modern world. In Asia we do understand it,'' he said.

Mr. Lee was using the stern, uncompromising language that has won him a reputation for being a man with strong convictions, sometimes bordering on arrogance. But his analysis of why Eastern Europe will not find it easy to attract private investment was delivered in cool, unemotional tones.

``Initially there will be an understandable tendency for the West to direct capital investment towards Eastern Europe, and for a while we in Asia and elsewhere in the developing world may be put at a disadvantage by that,'' Lee says.

But already the truth is dawning, he says. ``The Americans wanted to rescue the Gdansk shipyard, but when they went there they found they were talking to people who said that now Polish democracy was established, there should be social security, overtime, and any number of other things. But who would pay for it?''

Gesturing with his hand to emphasize the point, he explained: ``In this world you have to produce to pay for what you want. In Asia the link between worker productivity, management efficiency, and zero-defect products with worldwide markets has been firmly established.

``It will take years for the same thing to happen in Eastern Europe, and private investors from America and elsewhere are already starting to realize it.''

The graying but lithe politician has led his island republic continuously since 1959 and has turned it into an Asian economic dynamo. Later this year he plans to step down and hand the Singapore premiership to a deputy.

Lee shows a strong grasp of today's swiftly changing patterns of international relations. With Soviet power in the world receding, was it relevant any longer to think of the security of Asia and the Pacific in terms of threats or perceived threats?

``In the old sense that there was a center in the world, whether it was Moscow or Peking, that inspired insurgency and communist revolution, things have changed. But with the altered superpower relationship, we in Asia are going to have our own latent indigenous problems.

``We can expect indigenous conflicts to spring up to the surface because nowadays we are not facing a common enemy. I hope the United States, acting as a kind of sheriff, will still be there to prevent bully boys from muscling into the region.

``American power does not have to be as great as it has been, but it will still be needed.''

In talking of bully boys, was Lee thinking of a threat to the region from Japan? He chooses his words with great care.

``As an economic power, Japan has been a reality for 10 or 12 years. That is bearable. ... They are not a threat, and they do not prevent us from being ourselves. But there would be a problem if the alliance between the United States and Japan were broken.''

Removal of the American presence, Lee says, would entail an expansion of Japanese power. ``No one in Asia wants that - probably not even the Japanese themselves.''

The Singapore leader has been a firm supporter of the Association of South East Asian Nations (ASEAN). Today he expects it to play a key role in easing new tensions that he thinks are certain to arise as the superpowers reduce their influence in the region.

``In ASEAN we have created a habit of working together. I am a pessimist by nature, but I am more optimistic now about our continuing cooperation in economic matters than ever before.

``The Malaysians want companies in Singapore to invest in Malaysia. The Indonesians are opening up the island of Batam, 15 miles south of Singapore, to establish factories to produce the goods we can no longer make because our wages are too high.

``This habit of shared growth will cement the relationships between us as neighbors. It will be a basis of future strength.''

The type of democracy Singapore has enjoyed during three decades of rule by Lee Kuan Yew is strict. His critics have sometimes wondered whether such an authoritarian leader would ever be willing to relinquish power.

He says that the essence of Singapore democracy had been the discipline of the country's 2.5 million people, and that most of the pressure for discipline - for example, stringent antidrug legislation - had come from him.

Without his leadership, will Singaporeans be able to impose discipline on themselves?

``The choices for Singapore are not that wide,'' Lee says. ``It is a very small place in a large and changeable world. If it is not nimble and swift in making adjustments, it will perish, and our people know it.''