“This is a long process. They have been talking for a long time, they seem to be making progress. Unfortunately, there was no deal at the last minute,” Lee said, according to a transcript of the interview.

“I think there were some hurt feelings on both sides. So it will not be so easy to overcome the problem.”

Asked by the Japanese publication about “easier issues” that could be resolved between the feuding countries – also embroiled in what some observers have termed an early-stage tech cold war – Lee mentioned technology and cybersecurity.

Said Lee: “If you start talking about human rights, those are very complicated and they affect many areas, but the trade package – if we treat it just as trade – I think there are ways to tackle the imbalances which have arisen, and to work out practical arrangements to go ahead.”

But it would be impossible to make progress if either side felt that trade was being used as a means to be “one up on the other parties or to keep the other party down”, he said.

China thinks it can weather trade storm. It can, but not for long

As a result of the trade war, Lee said he expected Singapore’s 2019 gross domestic product growth to come in somewhere between 1.5 per cent and 2.5 per cent, “significantly lower” than last year’s 3.1 per cent growth.

“But given the global conditions, I think it is about the best we can do. Meanwhile, we make our continuing efforts domestically to upgrade our workers, to upgrade our businesses, to transform the economy and adapt to the new world,” he said.

The prime minister, however, said he did not think the trade war’s short-term impact would be as severe as the fallout from the 2007-08 global financial crisis.

But in the long term the feud could have serious consequences for the structure of the global economy, he said, raising the prospect of a “bifurcation of technology of markets” as a major negative for international trade.

Asked if Trump was likely to talk to Xi about Hong Kong’s mass protests against an extradition bill that would allow suspects to be brought to the mainland to face trial, Lee said he did not know what would happen.

From Singapore to Manila, how Asia sees Hong Kong protests

Protesters – who numbered up to an estimated 2 million during one rally – also want Lam to resign. Beijing has sternly said that this demand is out of the question.

“[Discussing Hong Kong] was not on the [G20] agenda,” Lee said. “The matter has come up; I imagine they will discuss it.

“I think it will be a difficult one because from China’s point of view, they will see it as a question of sovereignty. I mean, ‘one country, two systems’, and Hong Kong is part of one country.”

When asked if he thought the city’s status as an international business hub was under threat, Lee said Singapore wished Hong Kong well.

The view from Singapore: Hong Kong is a city tearing itself apart

“We do a lot of business with Hong Kong. We do not see them as a threat to us at all, and I do not think they see us as a threat to them. We hope that they will overcome these problems,” he said.

Lee, a regular at G20 summits even though the Lion City is not one of the world’s 20 biggest economies, said he believed Singapore was invited to the annual meetings because it offered perspectives from the point of view of a small state.

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