SINGAPORE: Manufacturing activity in Singapore fell into recession territory in April as tariffs announced by US President Donald Trump triggered a wave of export-order deferments and cancellations.
The purchasing managers’ index (PMI), a barometer of the manufacturing sector’s health, fell to 49.6 points in April, down one point from 50.6 in March.
Readings above 50 indicate growth while those below point to contraction.
The contraction in Singapore’s factory activity snapped 19 straight months of expansion, according to the Singapore Institute of Purchasing and Materials Management (SIPMM), which issued the report on May 2.
The last time the manufacturing PMI was below 50 was in August 2023 when it stood at 49.9 points, SIPMM data showed.
Stephen Poh, SIPMM’s executive director, said the US tariffs have started to take a toll on the local manufacturing sector.
“Local manufacturers reported order deferments and cancellations from foreign buyers who were greatly affected by the high reciprocal tariffs,” he said.
The PMI for the electronics sector – which accounts for about 40% of Singapore’s manufacturing output – dropped by 1.1 points to 49.8 points for the first contraction after 17 months of expansion.
Chua Han Teng, senior economist at DBS Bank, said the PMI decline was the steepest observed since the onset of the Covid-19 pandemic in early 2020.
It looked consistent with the deteriorating business sentiment among manufacturing firms for April to September 2025, as shown by the Economic Development Board quarterly survey on April 30, he added.
Trade tensions and uncertainty over the global economic outlook have risen since April 2 when Trump announced a raft of tariffs.
A 90-day pause was declared on the higher-band levies, dubbed reciprocal tariffs.
However, all countries including Singapore are subject to a baseline tariff of 10%.
China, Singapore’s top trading partner, is the only country that is still subject to US tariffs announced on April 2 and which were subsequently raised to an unprecedented level of 145%.
The 25% sectoral levies on all US imports of steel, aluminium, and automobiles and parts remain in place as well.
Also, Trump has threatened to impose similar levies on imports of pharmaceuticals and semiconductors.
SIPMM said the latest manufacturing PMI reading was attributed to a first-time contraction in the key indexes of new orders, factory output and employment.
Slower expansion rates were recorded for new exports and imports, and input purchases.
The future business index reverted to a contraction after posting 21 months of continuous expansion.
Meanwhile, supplier deliveries, finished goods and order backlogs posted faster expansions.
For electronics PMI, the latest reading was attributed mainly to a first-time contraction in new exports, factory output and employment.
Slower expansions were recorded for new orders, input purchases, finished goods and imports.
Meanwhile, faster expansions were recorded for supplier deliveries and order backlogs. — The Straits Times/ANN
