role and we'd like america to continue to do that. >> rose: a conversation about china, the united states, asia, and the world with the prime minister of singapore when we continue. captioning sponsored by rose communications from our studios in new york city, this is charlie rose. >> rose: singapore's prime minister lee hsein loong is here. he is in the united states this week for the nuclear security summit and for meetings with american officials, including the secretary of state. he's been prime minister since 2004, he's only the city state's third prime minister. he is the son of lee kwan yue, singapore's founding father. i am pleased to have him back on this broadcast with me while he's making this visit to washington. welcome. >> hello. >> rose: tell me what you think was accomplished at this summit of 46 nations. >> i think president obama did the world a service. this is an issue, nuclear security and nuclear terrorism which is important but not urgent. it's not something which we have to solve overnight but it's a problem which is a real problem and if we don't do something about it, some time, some place something disastrous will happen. and he managed to get many leaders together, focus their minds, put on the table what they are able to do, what they are planning to do further to secure the nuclear materials and trade and smuggling of these materials and commit to take further steps together to make the world a safer place. >> rose: so over the next four years, the goal is to make sure that they know where all the nuclear weapons are, they can make sure that they're safe and not likely to fall in the hands of terrorism? >> well, the nuclear weapons, the loose nukes are the first problem. because that's... if i were a terrorist, that's the first thing i'd look for. >> rose: look for the loose nukes. >> yes. but even short of the loose nukes, if you can find highly enriched uranium, you might find people smart enough to put that together into a bomb. there's enough information on the internet to make a good stab at it. >> rose: how much of the topic here was about iran? or was it only among certain nations? >> i'm sure the key players, the p five plus one, permanent members of the u.n. security council plus germany were discussing it. i know they were. it's a subtext. we didn't explicitly discuss iran, but obviously iran is one of the concerns. we were not at the meeting but if they have this capability, either make their weapons or to make the materials, then there are implications for proliferation and for nuclear security. >> rose: give me your assessment, if you will, of president obama's global leadership at this time. he came here after health care success in america. he came here after a deal with... he came to the summit with the russians and now this summit. is he becoming-- beyond the fact that he represents america-- an important player? >> america is always an important player. and the president is always a key person. and right now president obama has inherited a full plate globally: iran, which we mentioned, iraq, which is sort of on the mend but i think will be a concern for some time to come. afghanistan, which is a long way from being done. north korea. relations with china. relations with russia. israel, palestine. and amidst all this busy program we hope that he has some mind share and some focus to pay attention to southeast asia and a little bit to sing mother. >> rose: do you feel that he is doing that? >> i think he's doing a good job of that. he came to the aipac meeting which we hosted in singapore last year. he came to the first ever meeting of the u.s. president summit with all ten of the asean leaders, including myanmar, and it was a good meeting. all ten welcomed the meeting and welcomed america's engagement in the region. and that's saying something. >> rose: china, especially today and its relevance to this, certainly with respect to iran. where do you see china and its role in the world and china and its relationship to the united states? >> i think china's relationship with the u.s. is crucial. it's a most-important bilateral relation in the world now. and both sides have a big stake in making sure it turns out right and not turns out sour because your trade, your interdependence, your national security interests, of course they are issues where you will rub against one another, human rights or google or whatever. but both sides have a greater stake in keeping it right than letting it go wrong. and in asia we particularly don't want to have to choose sides between china and the u.s. we want to be friends with both. there are a lot of opportunities in china. china is making a big effort to win friends all over the region and doing well at this. but at the same time, all the countries in the region know that america plays an indispensable role and we would like america to continue to do that. >> rose: are there things that america should be doing to make better its relationship with the region? china, but also sing snore also... >> attention is, of course one thing. is f your mind is focus misdemeanor good ideas will come along. but one major area is trade. the chinese trade in asia with china is growing rapidly. all your major allies in asia, except perhaps the philippines, have china as their number-one or number-two trading partner. so if you want to be at the table, if you want to enhance this relationship and talk about security and political relations you must have economic relations. and you must taken a active trade agenda. that means pushing for america to be present in the region for your companies and opening american markets and enhancing the relationship. >> rose: with respect to american companies, my impression is they have a huge presence in asia and singapore. >> the economy is growing and there are many more possibilities. >> rose: so they should do more. >> i think there are many possibilities for them to do more. both to exploit the markets which are in asia and also to be based in asia to produce for the world. a lot of china's trade with america has american companies based in china manufacturing and selling back to america. >> rose: there is also the issue of currency. >> yes. >> rose: everybody wants china to change its currency. >> yes. >> rose: to let it rise. do you? do you believe they should? or r you prepared to urge them to do that? >> i think the position which they took before the crisis, to let the currency float up, actually rise up gradually in a managed sort of way was the right thing to do in their circumstances. you are running a trade surplus, their exports are booming. if they allow the currency to rise it will... it may raise the costs sum but it will sat the same time diminishing the inflationary pressures within that country. and it's part of the adjustment as you become more productive and your standards of living go up. they shifted to a more conservative position over the last two years and fixed to the u.s. dollar. >> rose: right. >> caused a lot of angst. >> rose: and helped their exports. >> yes, temporarily. but after a while it causes overheating in the economy. and i think in this situation really they should revert to where they were before the crisis and allow the u.n. to go up gently again. >> rose: the "new york times" has an editorial today reflecting i think what many people believe. a number of nations ought to come to china and say that so it doesn't look like one nation is trying to pressure them. >> i think many people have made the point to them and they have to make their own calculations and when they do it they'll do it for their own reasons. >> you know the chinese mind. where do you think they see it? because people say they do not want the west especially to pressure them and to treat them >> i don't think it's just the chinese. no country want to be pressured. you ask netanyahu or any other leader whom you have had dealings with. you have to have a certain courtesy and respect and restraint. but countries have to make calculations in their own interest and america has many ways to influence their calculus. >> rose: has president obama set the country on a new course as far as you can observe? because you've been prime minister since 2004. >> i think he set a new tone. his instincts are different. his personal styles and his strengths are different set of strengths from president gr gohr's. >> rose: how is his instinct different? >> well, i think he is much more prepared to start with talking from his allies rather than starting from deciding where america wants to go and then bring along a posse of the willing. it doesn't solve all problems, but it's a refreshing new approach which i think has improved america's image in a lot of the world, including the muslim world. >> rose: and how does that make a difference if america's image... >> it doesn't solve the israel/palestine problem but it's one of the ingredient which is america must deploy when you're trying to tackle these very difficult issues. the issues will be there for a long time to come. you won't clear them all even with two presidential terms. but you're now in the world where america is a superpower but you're interdependent and you have to work with other countries to make things happen which is what i think obama did with this nuclear security summit. >> rose: and with russia. >> indeed. >> rose: was the united states hurt in terms of its relationship with china because of the sale of the aircraft to taiwan and receiving the dalai lama. >> you have to do what you have to do. these are not issues which you could expect to be received with acclaim in beijing, but you have to make your own chral collations and decide what's in the long-term interest and what your relationship with china can weigh. you haven't... you have a reputation to hold up. you must be seen as a reliable friend. at the same time you must also friend of your allies. by the same time, you must know which are the issues which are red lines and if you want to cross them, do so without thinking about it. >> rose: the consequences of. >> yes. >> rose: and china, china came to the summit and people were pleased by that. because there was a feeling right before that they were being more aggressive and in a sense less friendly to the united states. >> i think that they are trying to calibrate their position because having emerged in the world and become economically much more powerful than before and influential with friends and connections all over the world, deng xiaoping's old victim to hide your light under a bushel and go quietly into the world, it still applies while they're trying to figure out how to apply it. >> rose: because their light is so much brighter today. >> well, because now when they move they can no longer just move as a small country. it affects the whole system. and you have to decide how to trade of your interests, maximizing for yourselves. first the interest of the whole system and your long-term requirement to be a constructive player in the world system. which is what america has done since the second world war. you were at one time the enormously preeminent superpower. but there was a restraint, good will, generosity of spirit. and so after 60, 70 years in asia people still say america plays an indispensable role. >> yes. >> rose: and i think that is something which if the chinese could achieve it would be quite something. >> if the chinese could achieve... >> if the chinese could achieve that acceptance of that place in the world. >> rose: so people around in the world in latin america and... >> they are going to be powerful but they are not going to be this middle kingdom because the world is not like that anymore. however powerful you are, you need friends, you need allies, you need a peaceful world environment in which they can operate and they can concentrate on growth and development and improving the lives of their people. and that takes... that requires you to take a long-term perspective and not try to maximize on every single issue. >> rose: for chinator united states or both? >> for both. i'm saying america has been able to do this by and large over a long time and china now emerging i think was having to recalibrate its position in order to take these... hitherto totally alien considerations into account. they never had to think this because previously... i mean, the smaller impact on world affairs was not significant. they could do whatever they want and it's a closed kingdom but now you can't. >> what do you think they will do on iran? >> i think they will... they are discussing that among the p p5 now. i believe president hu had a discussion with president obama on that. >> rose: your impression that was a very good meaning? >> from what the administration people have told us, the u.s. side was happy with it and felt there was progress. but their calculation will be a little different from your calculation you want to... you are very seized with the issue of iran becoming a nuclear power and the implication strategically and the middle east and worldwide. >> rose: do you agree with that? >> yes, i agree with that. >> rose: does china agree with that? >> i think they intellectually agree with that but they will at the same time calculate their reliance on iranian oil. secondly there is the overall relationship with america and other critical issues to them and then try and decide how this fits into the overall system of their foreign affairs. >> rose: china's also experiencing... each leadership level, each time they have a next leadership decade they seem to be different and give us a sense because you represent that in singapore. how the upcoming generation of chinese leaders and other asian leaders are different from those they succeeded. >> this current generation... the generation before this experienced the second world war and the japanese invasion and occupation of china. it was an indelible impression for them and the experience revolution as the communists took over china and the first really exhilarating years. the great hall of the people in 12 months and the hole things that went on in 18 months and this tremendous sense of china standing up again. the current generation of leaders experienced a cultural revolution. they know what a mess china can be. it was mismanaged and how important it is that china get its act together, what challenges chinl faces internally and how important it is for china to grow and improve the lives of its people. and to continue to do this for another generation at least. the next... or maybe the next next group of leaders would be post-cultural revolution. they will have grown up in 30 years of reform and opening up. they will live in a china which is connected with the internet, with people who know what's... who are much better informed with what's going on throughout the world. where interests are expressed, there will be tensions between different parts of china and they will have to run this whole system not as a central system but with a market economy and with a coherent political framework on top of that and i think they will have a big challenge. >> what is it they see as a system that they would like to have? i mean, is it evolving away from the system that mou had? clearly it has in terms of its economy. but overall that and evolution you believe is ininevitable for china? >> i think it will evolve. i don't think they will ever have presidential elections every fourth year like you do. >> rose: (laughs) yes. >> but it will have to evolve and it's happening slowly, maybe slower than it ought to, is but they're extremely cautious... >> rose: and what are they worried about? >> instability. they have one chinese word for it, luan, which is disorder. and having seen the cultural revolution, they don't want to go back. >> rose: and then they saw tiananmen. >> and falun gong who appeared as a flash mob one day in front of the inner sanctum and it was the first they ever heard of falun gong and that scared the daylights out of them. >> rose: it did? >> yes. that's how they discovered it existed. >> rose: but is that a threat to them? >> when they discovered who was in the falun gong and how many of the senior officials had joined the secret group it was... >> rose: they were what? >> they were shaken. >> rose: so therefore they have >> so they are concerned about disorder but at the same time i think they though they have to allow for people to be engaged in the system and to make able chinese feel that this is a system which reflects their interest and aspirations and which they have some stable... you may not vote for the president but if you are a person with ideas and whose views are relevant, they ought to carry weight and should be expressed somewhere in your system in your policies and outcomes. i think they know how that. how to get there, i don't think they've worked it out and they are moving only quite slowly. >> rose: because they haven't worked it out. do they want to be part of the existing international system? >> yes, but they would like to have their share of the sunshine >> rose: which is reasonable. >> which is reasonable. but how do they get their share compared to where they are and what is the transition like? that's something that has to be managed. >> how would you define their share of the sunshine? >> well, they would tell you they have one thousand three hundred million people. and each one of them... >> rose: that's the fair share. >> and each one is entitled to so many kilograms of carbon dioxide. >> they do say that. they say we have a billion three and the world has six billion, figure it out. >> yes. well they know that they are not there because they will also tell you that per capita income is very low. there are many people below the poverty line, that agriculture is abysmal by global standards of productivity and that they have to make major transformations even to get to a modest middle-income level. so their thoughtful leaders have their that prominently in their minds and therefore are quite cautious about overasserting their arrival. but not all young people are quite as careful about it. >> rose: your father told me once that dung chao ping came and was... deng chao ping came and was appreciative of what happened in singapore to observe and said we want to do that. how do we do that. >> they came, they looked at our schools and water conservation, the way we recycle waste water and turn that into new water which we can use again for industrial and drinking purposes indirectly. they look at the way we manage our financial system. they look at the way we manage our housing. they look at our health care system. they are interested in many of the pieces we are doing, but most of all they want to know how do you run a system where the government can have legitimacy and there's order and there's continuity over a long period of time. and the system works and is incorrupt and there's accountability. and that's a secret which is... they think it's a secret. in fact, they can see how we do it. but to be able to translate what we do, three million people in a tiny little island to one thousand three hundred million people-- one quarter of humanity-- that's not a so easy. which is not to say they haven't learned. but it means what we do in singapore, it's a mod tell we can look at, it's very interesting. but they have to work it out how they make their own model in china. >> are they becoming creative, innovative, less as we used to have this image of china as being more sort of... >> if you visit you will see it's a very diverse, very vibrant place. many arguments and debates very open discussion of many issues except far few taboo areas. >> rose: which are are politics. >> communist party, taiwan, tibet. >> rose: but politics... >> other aspect