In April 2025, the United States (US) imposed a 10% tariff on nearly all imports, including those from Singapore, under the International Emergency Economic Powers Act. Despite having a free trade agreement with the US and a relatively balanced bilateral trade relationship, Singapore was not granted an exemption. These tariffs are expected to significantly impact Singapore’s finance, manufacturing, and trade sectors, prompting policymakers and businesses to reassess risk and resilience strategies.
Singapore’s financial services sector, which contributed 13.5% to its SGD 528.6 billion (approx. USD 391 billion) in services exports in 2024, may experience turbulence. The US is a key market for Singapore’s cross-border fund management and advisory services. As uncertainty rises, the Monetary Authority of Singapore is expected to consider supportive monetary policies to enhance export competitiveness. Financial firms are also likely to see increased demand for currency hedging and risk management solutions to navigate rising market volatility.
The manufacturing sector—especially electronics and precision engineering—faces challenges due to its exposure to the US market. In December 2024, Singapore’s non-oil domestic exports grew 9.0% year-on-year, largely driven by semiconductors and other electronics components. A significant portion of these products is integrated into US-bound supply chains. The new 10% tariff increases production and export costs, threatening profit margins and competitiveness for Singapore-based electronics exporters already contending with shifting global demand patterns.
Singapore’s trade and logistics sector could also feel the strain. A potential decline in trans-Pacific shipping volumes may hurt earnings for port operators and logistics firms. Small and medium-sized enterprises relying on re-exports to the US may face shipment delays and higher compliance costs. However, Singapore’s diversified trade agreements—such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP)—along with continued investment in digital trade systems, could help cushion the blow and provide alternate pathways for growth.
(Source: ASEAN Briefing)
