US willingness to act unilaterally, including military actions in Venezuela, has major geopolitical implications: SM Lee

On the security front, European countries are engaged in deep soul searching on the responsibility they can take for defence and how they can come together in order to determine their own security policy and be less dependent on the US, Mr Lee said. 

“It’s going to be not just a lot of budget, but it’s also going to be the difficulty of coming up with a European policy (on) security, direction and action. And that’s a fundamental change to the world,” he said. 

Ukraine, on the frontline of a war with Russia “with a completely different US”, will now have to think about what is a realistic path forward, Mr Lee added.

Meanwhile, Asia Pacific countries will also be “rethinking their positions carefully”, he said. The US remains a very important security and economic partner, among other things, but China is a major and growing partner in economic issues and more. 

“I think a lot in the Asia Pacific will depend on how China decides that it wants to engage its regional neighbors and the world,” he said. China has been making the “right statements” about multilateralism, trade, and a rules-based system, and “we hope to see that this will be realised as real policies”.

“We are now in a different world, and we are going to see the consequences of the sea change in the economy, as well as in the security area, in 2026 and for many years to come,” said Mr Lee. 

“We hope we don’t have any tectonic shocks again … Nobody can predict these things, but we hope that 2025 will have been more exciting than 2026.”