(from Newzzit; the original story is here http://newzzit.com/stories/sino-singapore-pragmatism-at-its-best)

Giving the state of affairs now, its difficult to believe that Singapore was the last country in ASEAN to formalize relations with China in 1990, shortly after Indonesia did so

“Ultimately, Singapore must always be pragmatic above all else. While Singapore will remain optimistic and work towards the prospect of a peaceful and responsible China, she must always retain its fall-back options of US involvement and a credible Singapore Armed Force (SAF).” This conclusion which appeared in Pointer – official journal of the SAF, under the article, Hedging for maximum flexibility: Singapore’s pragmatic approach to security relations with the US and China, aptly summarises Singapore approach to its relationship with China.

Maj Cai Dexian, who is an armor infantry officer in SAF further wrote, “Singapore has always taken great pride in her pragmatic, non-ideological approach to foreign policy, adhering to lord Palmerston’s (British PM between 1855-1865) invocation that 'we have no eternal allies, and we have no perpetual enemies. Our interests are eternal and perpetual, and those interests it is our duty to follow'.”

“Singapore has not and will not adopt pure balancing or bandwagoning strategies, because neither fulfils her core interests of survival and prosperity through regional stability and freedom of manoeuvre. Instead, Singapore must find ways to position herself via-à-vis the great powers in a way that will maximise her interests while minimising risk, and therefore should take up a 'hedging' approach.” 

Praise all around

A point stressed again by the London School of Economics and Political Science in its publication, The New Geopolitics of South-east Asia. “Singapore hedges its cultural, spatial and economic proximity to China with robust diplomatic, military and economic relations with the US and through regional participation in ASEAN and international organisations. By doing so, Singapore pursues its grand desire to remain uniquely Singaporean,” wrote Robyn Klingler Vidra. 

In a report prepared by the Congressional Research Service – which is submitted to the members and committees of US Congress, it was noted that while Singapore has praised the Obama Administration's renewed “rebalancing efforts” towards Asia, it has been careful  to warn that anti-China rhetoric or efforts to “contain” China’s rise will be counterproductive. During an April 2013 visit to Washington, Singapore's Prime Minister Lee advised the US to strengthen its economic ties to the region and develop more trust with Beijing, the report said.

“Maintaining strong relations with both China and the United States is a keystone of Singapore’s foreign policy. Singapore often portrays itself as a useful balancer and intermediary between major powers in the region. In the South China Sea dispute, for example, in 2011 Singapore—a non-claimant—called on China to clarify its island claims, characterizing its stance on the issue as neutral, yet concerned because of the threat to maritime stability. At the same time, Singapore was hosting a port visit by a Chinese surveillance vessel, part of an ongoing exchange on technical cooperation on maritime safety with Beijing,” added the report authors. 

Reason

An explanation of Singapore's highly successful pragmatic approach in dealing with China is given by The National Institute for Defense Studies (NIDS), Japan, in its publication, The Rise of China: Responses from South-east Asia and Japan.

“The tired but not retired cliché that Singapore, because of its large ethnic Chinese constituency (nearly 76% of the total population), constitutes a 'third China' fails to take into consideration the fact that Singapore, ensconced between two larger Malay-Muslim neighbours, treads very cautiously when relating to Beijing. In this regard, Singapore has worked especially hard to shake off the label of itself as 'a Chinese island in a Malay sea' so as to avoid being distracted from its domestic goals by unnecessary attention provoked by any perceived effort on its part to bandwagon with China. For example, in deference to regional sensitivities and concern over criticism that its foreign policy is ethnically oriented, Singapore’s normalization of ties with China did not occur till November 1990, after Indonesia had done so in August 1990. Moreover, it is not simply external considerations that argue against bandwagoning with China, but domestic interracial cum socio-economic ones as well, not least the small yet politically sensitive non-Chinese constituencies of the city-state,” argued See Seng Tan in his article Riding the Chinese Dragon: Singapore's Pragmatic Relationship with China, for NIDS.

The Taiwan issue

Vidra explains it further. “In the early years, Singapore and its ASEAN partners were sceptical of China’s motives and approached the relationship with apprehension. Today, however, much of the remaining tension between Singapore and China relate to Singapore’s relationship with Taiwan.”

Taiwan and Singapore have held large-scale military exercises annually for over 30 years and, in 2010, announced the launch of talks related to a free-trade pact under the framework of the World Trade Organization. “Formal negotiations between Singapore and the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu (Chinese Taipei), both members of the World Trade Organisation (WTO) , have commenced for the 'Agreement between Singapore and the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu on Economic Partnership' (ASTEP), informs International Enterprise (IE) Singapore, the government agency driving Singapore’s external economy.

Maj Cai Dexian also sees it as the clearest example of how Singapore has maintained her political independence by having a close relationship with Taiwan, despite Chinese displeasure. “Notwithstanding her adherence to the 'One-China' policy and her non-establishment of formal diplomatic ties with Taiwan, Singapore continues her friendly and mutually beneficial relations with Taiwan the defence and economic spheres. While Singapore has at times deferred to China over the Taiwan issue (eg. voting in favour of China’s admission to the UN in 1971, as opposed to Taiwan), she nevertheless continues to display a remarkable degree of independence. For example, Singapore has declined China’s offer of Hainan Island as a training ground to replace Taiwan, demonstrating loyalty to an old friend,” he wrote.

Recent Sino-Singapore collaborations

• Bilateral projects: China-Singapore Suzhou Industrial Park, Sino-Singapore Tianjin Eco-city and Sino-Singapore Guangzhou Knowledge City

• China became Singapore's third-largest trade partner last year; Singapore is also the only ASEAN member that has signed a free trade agreement with China

• Singapore's development as an offshore Yuan hub was kick-started in May, when the Industrial and Commercial Bank of China started its Yuan-clearing services here