Container ships and bulk carriers sit at anchor just beyond Singapore's Marina Bay Sands hotel in February 2024. | Bloomberg

Stand on a clear day atop Singapore’s Marina Bay Sands hotel and you can see the city-state’s promise and peril in a single glance.

In the foreground, a flotilla of ships lies at anchor, a physical reminder of how Singapore grew rich servicing the immense volume of global trade squeezed through the choke point of its narrow strait. On the horizon, you can just make out the coastline of Indonesia, a country with almost 50 times Singapore’s population and 2,500 times as much land. Its proximity is a reminder about how dependent that prosperity remains on good relations with Singapore’s much larger neighbors.

Such issues are top of mind right now. For weeks, the view has been obscured by a pall of haze drifting across the water from wildfires on the Indonesian islands of Borneo and Sumatra.…