Will Singapore avoid Trump's tariffs but face US-China trade war ‘crossfire'?
While Singapore appears unlikely to face direct tariffs from the United States, its small and open economy could be 'caught in the crossfire' of a trade war between the superpowers, analysts have warned.
Those who spoke to This Week in Asia agreed with Foreign Minister Vivian Balakrishnan's assessment in Parliament on Tuesday that while Singapore was unlikely to be on the US tariff 'hit list' due to Washington's trade surplus with the city state, it would still be indirectly affected.
'Even if you assume that there are no direct tariffs against the export of Singapore products and services, the fact that we are a small, open economy, and trade constitutes more than three times our GDP, means if there is any friction, degradation of economic integration, global supply chains, and world trade, we will be impacted indirectly,' Balakrishnan said.
Urging parliamentarians to remain calm, he added: 'I do need to prepare Singaporeans that it will be a turbulent ride in the months or years to come.'
Two-way trade between Singapore and the US totalled US$131 billion in 2023, with the world's largest economy recording a surplus of US$26.7 billion, according to the American Chamber of Commerce in Singapore.
Alvin Liew, senior economist at United Overseas Bank, warned that escalating trade tensions and tariffs could hurt economic growth in the US, China and Asean. He said Singapore was vulnerable to downturns in these economies, as well as in the European Union.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
RTHK
7 days ago
- RTHK
Hegseth sparks potshots with Lee-Trump comparison
Hegseth sparks potshots with Lee-Trump comparison Secretary of Defense Pete Hegseth in the midst of making his speech outlining US strategy in the region at the Shangri-La Dialogue in Singapore. Photo: Reuters US Secretary of Defense Pete Hegseth rankled Singaporeans on Saturday by likening President Donald Trump to the city-state's late founding prime minister Lee Kuan Yew. In a major speech outlining US strategy in the Asia-Pacific region, Hegseth referred to both leaders as "historic men". "Like the late prime minister, President Trump's approach is grounded in common sense and national interests," he said at the Shangri-La Dialogue which gathers key defence leaders from around the world. Lee, a British-trained lawyer, served as Singapore's prime minister for three decades. Hegseth praised his "sage leadership and strategic vision". "That's what common sense policies can achieve, and that's precisely what President Trump's vision is all about." Lee, who turned Singapore into a high-tech industrial and financial centre, remains highly revered in Singapore more than a decade after his death. Social media erupted with loud and acerbic criticism of Hegseth's comparison. "One is historic, the other is hysteric," said one commenter. Another said: "Trump compared to Lee Kuan Yew? That's like saying instant noodles are the same as fine dining." "I felt a tremor just now. Must be LKY rolling hard in his grave," said someone else on social media, using Lee's initials. (AFP)
RTHK
26-05-2025
- RTHK
King Charles arrives in Canada to open Parliament
King Charles arrives in Canada to open Parliament King Charles was met by Canadian Prime Minister Mark Carney at Ottawa Airport. Photo: Reuters Britain's King Charles III arrived in Ottawa Monday for a visit to open Canada's parliament, a brief trip seen as part of the pushback against US President Donald Trump's annexation threats. The 76-year-old monarch, who is Canada's head of state, was greeted at the airport by Prime Minister Mark Carney, who has invited him to give an address opening Canada's new legislature. The so-called throne speech outlining the government's priorities is typically given by the British monarch's representative in Canada, the governor general. Queen Elizabeth II, the king's late mother, delivered a throne speech in Canada just twice during her long reign, in 1957 and 1977. Charles, making his first visit to Canada since his coronation, will be closely watched for any comments on Canada's sovereignty, and on trade. Trump has slapped tariffs on Canadian goods including sector-specific levies on autos, steel and aluminium, rattling the Canadian economy, although he has suspended some of them pending negotiations. Carney has said his newly-elected government has been given a mandate "to define a new economic and security relationship with the United States," a neighbour he believes Canada "can no longer trust." He has promised to curb reliance on trade with the United States by boosting internal commerce while forging deeper economic ties with allies overseas. The government's path to build up Canada and create new relationships will be outlined in Charles's speech, Carney said Monday. "This historic honour matches the weight of our times," he said in a statement. A government statement described the visit as "a momentous and historic occasion that underscores Canada's identity and sovereignty as a constitutional monarchy". (Reuters)
Asia Times
24-05-2025
- Asia Times
Civilizational multipolarity in a post-Pax Americana world
In 2016, Singapore's then-Defense Minister Ng Eng Hen was asked in Parliament how the country would respond if the United States were to pull back from its security commitments in Asia. At the time, the question was hypothetical. Today, with Donald Trump in his second term and Ng stepping down after 14 years as Singapore's longest-serving defense chief, the question has become reality. The American security umbrella – long taken for granted by many of its allies – appears to be fraying. The post-WWII order, underwritten by US military dominance and financial centrality, is no longer assured. And in anticipation of a post-Pax Americana world, states are adjusting accordingly for a new order. The first fault line lies in deterrence. For decades, US allies were content to rely on American protection rather than build up their own armed forces. That era is over. Germany has committed US$107 billion to defense upgrades. Poland now spends 4% of GDP on its military – more than any other NATO member. Asia tells a similar story. Japan is doubling its defense budget by 2027, upending long-standing pacifist traditions. In South Korea, 76% of citizens now support developing nuclear weapons – an idea once unthinkable under the US nuclear umbrella. Across both regions, allies are hedging against the possibility of American abandonment. The second fault line is financial. The American military's reach has long been sustained by global demand for US Treasuries. But the foundations of that system are weakening. In FY2023, the US ran a budget deficit of $1.7 trillion, $1.1 trillion of which went to defense and veterans' spending. Meanwhile, foreign appetite for American debt is shrinking. Overseas ownership of US Treasuries has dropped from 42% in 2013 to 31% in 2023. China alone has reduced its holdings by more than $330 billion. The dollar's share of global foreign reserves, once above 70% in 1999, has fallen to 58%. What's more, the weaponization of the dollar – through sanctions, export controls and financial restrictions – has spurred countermeasures. The BRICS bloc is expanding non-dollar trade and exploring alternatives like central bank digital currencies. Economist Dr Yanis Varoufakis calls this the rise of 'cloud capital', a global financial architecture slowly decoupling from American control. The third fault line is institutional. The legitimacy of US leadership was once rooted in its commitment to multilateralism. Today, that commitment appears selective. From withdrawing from the Trans-Pacific Partnership and the Paris Climate Agreement to the chaotic exit from Afghanistan, Washington's global posture has become more transactional. Conditional support for Ukraine and shifting rhetoric on NATO have deepened doubts about America's reliability in its new role as an offshore balancer. The recent India–Pakistan conflict – killing over 50 civilians and inflicting $90 billion in economic damage by some estimates – revealed how quickly a confrontation between nuclear powers can now spiral without a more timely US intervention. Yet the greater challenge may not be the retreat of the American umbrella itself but rather what emerges in its absence – a shift I call 'civilizational multipolarity.' What makes this moment distinct from any other in history is not just the redistribution of power – it is the nature of the actors now asserting that power. For the first time, multiple civilizational states – China, India, Russia and Iran – are rising within a shared global system. Historian Professor Wang Gungwu calls this the return of 'civilizational consciousness' – a dynamic in which states derive legitimacy not from universal norms but from deep structures of language, religion and institutional memory. China exemplifies this shift. As scholar Dr Martin Jacques observes, China views itself not merely as a nation-state but as a 'civilization-state,' with 5,000 years of political tradition and moral philosophy. The Chinese Communist Party's claim to authority is not based on liberal norms but on restoring what it sees as the Middle Kingdom's rightful place in history. This has far-reaching consequences. Professor Graham Allison's 'Thucydides Trap' warns of conflict when a rising power threatens a ruling one. But in today's context, the competition is not only over power – it is over values and visions of world order. Professor John Mearsheimer has argued that liberal internationalism cannot survive in a world governed by nationalism and realism. Civilizational multipolarity intensifies that prognosis: Powers now export governance models rooted in their own traditions rather than converging on a single set of norms. Professor Samuel Huntington's 'Clash of Civilizations' posits that cultural and religious identities will inevitably drive global conflict in the post-Cold War era, as fundamental civilizational differences – rooted in history, religion, and values – become irreconcilable fault lines between nations and blocs. But there is still agency in how states respond. ASEAN, for instance, offers an instructive model through its principle of 'omni-enmeshment', an approach that avoids binary alliances while encouraging engagement across civilizational lines. Rather than choosing sides, ASEAN states create space for dialogue and cooperation, preserving autonomy while participating in global governance. If the global community can embrace this ethos, civilizational multipolarity need not be seen as a threat, but as an opportunity: the foundation for a more pluralistic order within a shared framework. Singapore's new Defense Minister, Chan Chun Sing, captured this outlook well when he remarked at the 41st IISS-Asia Fullerton Lecture in 2021: 'Middle powers and small states can help to build bridges, create platforms for dialogue and uphold the multilateral system. By working together, we can provide alternative pathways for cooperation, even when larger powers disagree.' If this transition is managed wisely, the post-American era need not mark the unraveling of global order. It could instead herald the rise of a more inclusive, resilient and balanced system, one not defined by dominance, but by the peaceful co-existence and constructive engagement of civilizations. That would be a first in human history. And perhaps, its greatest achievement. Marcus Loh is a Director at Temus, a Singapore-based digital transformation services firm, where he leads public affairs, marketing and strategic communication. He was formerly the president of the Institute of Public Relations of Singapore. He presently serves on the digital transformation chapter executive committee of SGTech, the leading trade association for Singapore's technology industry. Loh completed an executive program in public leadership from the Harvard Kennedy School of Government and earned master's degrees from the Singapore Management University and University College, Dublin.
