Singapore sticks to its one-China policy and has no official relations with Taiwan, said Foreign Minister George Yeo on Friday.

Speaking to the parliament, Yeo said that the bilateral relations between Singapore and China are back on track after the setback last year.

"We now have a better understanding of each other's core interests and this has laid a strong foundation for building an even stronger relationship in the future," Yeo said.

The economic relations between the two countries continued to grow in 2004 as the bilateral trade volume hit 53 billion Singapore dollars (about 32 billion US dollars).

He explained the key elements in Singapore's foreign policy including working with its neighbors to integrate ASEAN (Association of Southeast Asian Nations), strengthening its ties with the advanced economies such as the United States, Japan and Europe.

Singapore will also build new links with Northeast Asia, South Asia, the Middle East and South America, as well as support the work of the United Nations and the World Trade Organization, Yeo said.