Off to open sea: A fully loaded container vessel leaving the Pasir Panjang terminal port. — AFP
Deputy Prime Minister Gan Kim Yong ruled out any immediate retaliation against the US after it imposed a 10% baseline global tariff that threatens to have a “significant impact” on the trading hub’s economy.
“We are naturally disappointed,” Gan, who is also minister for trade and industry, told reporters on Thursday, indicating officials will seek talks over the levies.
He cited the two nations’ traditionally close ties, and a long-standing free-trade agreement with the US that has mutually benefited both sides.
Gan said that the government has decided not to impose countermeasures despite being able to do so under the trade pact, because retaliatory import duties will just add costs for Singapore.
The city-state will be subject to the minimum universal tariff on all exports to the US, though it was spared the higher levies inflicted on many other Asian nations, including a total of 54% on China and 46% on Vietnam.
But the traditionally trade-reliant financial centre is likely to be affected indirectly, particularly if other countries respond with tariffs of their own.
“Singapore is likely the most susceptible to a tariff-induced external slowdown” among six of South-East Asia’s key economies, known as Asean-6, according to local lender United Overseas Bank Ltd.
The US recorded a trade surplus of about US$2.8bil with Singapore in 2024, data from the US Census Bureau shows.
Gan said Singapore will have to reassess the outlook for the economy, which was expected to slow even before Trump imposed the new levies.
In February, the city-state forecast growth of 1%-3% this year, down from 4.4% in 2024.
“I’m not saying we will definitely revise it downwards, but I think the situation has turned out to be worse” than we had expected, “and therefore it is necessary for us to revisit our assumptions,” he said.
Prime Minister Lawrence Wong had already set aside nearly S$124bil (RM407.5bil) in the 2025 fiscal year for a range of spending including airport upgrades and measures to address rising living costs, such as supermarket vouchers and utility rebates. — Bloomberg
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