Singapore Finance Chief Bows Out as PM Successor in Shock

by BLOOMBERG

Singapore Finance Minister Heng Swee Keat stepped aside as the designated successor to Prime Minister Lee Hsien Loong (picture), a shock move that will likely push back a long-telegraphed power transition in the city-state.

In a letter addressed to Lee on Thursday, Heng said the pandemic meant that he would likely be too old to take over as prime minister “when the crisis is over” roughly five years from now. He said a younger leader should take over instead, adding that he stands ready to support whomever is chosen by party officials.

“When I also consider the ages at which our first three prime ministers took on the job, I would have too short a runway should I become the next prime minister then,” Heng wrote. “We need a leader who will not only rebuild Singapore post-Covid-19, but also lead the next phase of our nation-building effort,” he added.

In a separate letter, Lee said he respected the decision and noted that Heng would step aside as finance minister in the next cabinet reshuffle. Channel News Asia reported that would take place in about two weeks.

“Together with the Senior Ministers, you will help me mentor the younger Ministers as the team develop and identify from among themselves another leader, in order to make a smooth and timely leadership transition,” Lee wrote.

The time frame spelled out by Heng leaves room for Lee to serve as prime minister for as long as half a decade more, unless party officials pick a new successor quickly. While Lee has previously signaled his intention to step down by the time he turns 70 in February 2022, last year he reaffirmed a pledge to stay until the country was in “good working order” following the weakest election performance ever by his ruling People’s Action Party.

In a separate statement Thursday, a group of younger party leaders said they respected Heng’s decision and asked Lee “to stay on as prime minister until such time when a new successor is chosen by the team and is ready to take over.”

“This unexpected turn of events is a setback for our succession planning,” the 32 so-called fourth-generation party members said in a statement. “We recognize that Singaporeans will be concerned. We seek your support and understanding, as we choose another leader for the team.”

A career civil servant and politician, Heng is currently both deputy prime minister and finance minister. His soft-spoken nature and collaborative approach won him allies in the business community, but a poorer-than-expected showing in the 2020 elections drew questions about his popularity and threw the timetable for succession into doubt.

Heng was poised to become Singapore’s fourth prime minister since 1965, a period that has seen uninterrupted rule by the People’s Action Party. His ascent would’ve heralded a change in leadership style for the nation, which for all but nearly 14 years has been run by Lee or his late father, Lee Kuan Yew.

Asked about succession plans in a November interview, Lee said the pandemic presented a “huge challenge” for Singapore.

“It’s existential, really, both economically as well as from a public health point of view, and I think it’s my responsibility to see us through this crisis before I hand it over in good shape — into good hands,” he said. “And I hope that will be before too long.”

Singapore’s economy is now showing signs of getting back on track from the worst slump in its history. Economists see Singapore’s growth recovering to a 5.9% pace this year, helped by about S$100 billion ($74 billion) in fiscal stimulus, following a 5.4% contraction in 2020 — the country’s worst performance since independence.

Lee, who came to power in 2004, has been one of the world’s most vocal leaders calling for the U.S. and China to avoid a destructive clash that could force smaller countries like Singapore to choose sides on everything from trade and technology to Covid-19 vaccines and territorial disputes in the South China Sea. The city-state supports a strong American presence in Asia by allowing the U.S. to use its military facilities while also counting China as its top trading partner.