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CNBC
08-08-2025
- Business
- CNBC
Singapore at 60: The successful city-state has big tests ahead — here's what's next
When Singapore gained independence in 1965 after its separation from Malaysia, few expected the small city-state — which turns 60 on Saturday — to survive. But in the decades since, the country of just 735 square kilometers — smaller than New York City — has transformed itself into one that regularly tops rankings for education , economic growth and safety . More than 50 years ago, it was confronted with high unemployment, poor infrastructure, and an uncertain future. Now, however, the World Bank describes the city-state as being "home to a high-income, globally competitive economy that is underpinned by one of the highest levels of human capital development in the world." But Singapore's hot streak raises the question: Can it continue to punch above its weight in the face of an uncertain trade environment and a great power competition between the U.S. and China? Ng Xin-Yao, investment director of Asian equities at Aberdeen Investments, told CNBC that Singapore is facing a global trade system that is "showing cracks and fragmenting." That threatens trading hubs like Singapore, which benefit from more from globalization. On top of that, Ng said, multilateralism is at risk as bilateral relationships grow in importance. "This puts greater power obviously in the hands of the superpowers, and that disadvantages smaller countries like Singapore," he said. Singapore Prime Minister Lawrence Wong said in Parliament on April 8, "We are very disappointed by the U.S. move, especially considering the deep and longstanding friendship between our two countries. These are not actions one does to a friend." Wong was responding to Trump's "Liberation Day" tariffs, which saw Singapore hit with a 10% levy even though it has a trade deficit with the U.S. and a free trade agreement since 2004. Earlier in 2025, Singapore's Ministry of Trade and Industry warned that the country was looking at the possibility of zero growth this year, in light of external pressures on its trade-dependent economy. Singapore's economy has an outsized reliance on exports. In 2024, exports made up 178.8% of its gross domestic product, according to the World Bank. Song Seng Wun, Singapore economic advisor at CGS International, said that Singapore's lifeblood was and is trade, and must therefore continue to rely on it to prosper. Modern Singapore was founded as a British trading port in 1819. Since then, it has grown to be the world's second busiest port. Changi Airport is one of Asia's major aviation hubs, and is the fourth busiest airport in the world in terms of international passengers carried. "Singapore's heart is all about trade, and the trade links are what drives Singapore's economy, through its port, through its airport," Song said. The republic has 28 FTAs , including with the U.S., China and the EU. But as the U.S. upends the global trading system, Song envisions that Singapore would now need a "two-track" trading system, one where it deals with the U.S., and another with the rest of the world. The country is also grappling with an aging population, a high cost of living, and the need to maintain its global competitiveness. Cost of living, availability of public housing, and job security were some of the hot-button issues in the country's 2025 general election. Singapore's government has created various programs to help businesses, including a so-called Singapore Economic Resilience Taskforce. Chaired by Deputy Prime Minister Gan Kim Yong, the taskforce aims to help businesses and workers navigate uncertainties arising from U.S. tariffs and related global developments, as well as to position the country to thrive in the new economic landscape. What's next However, when asked if Singapore needs a new playbook to cope with the changing new environment, CGS' Song said no. The country, should in fact, continue to double down on this strategy of clean governance and of committing to free trade, he said. More importantly, Singapore has to leverage its reputation of being a safe haven in this uncertain geopolitical environment, he said. "We don't flip flop on policies, we mean what we say, [and] if there are challenges, we deal with that." Singapore was rated as one of the best places to do business , with the Economist Intelligence Unit identifying factors such as political stability and the government's focus on helping domestic private-sector companies upgrade technologically . Tan Su Shan, CEO of Singapore's DBS Bank, told CNBC, "we remain open ... we remain stable, transparent, resilient, but the politics is stable. The markets are open, the rule of law is clear and transparent, and we continue to be a safe and secure financial hub. So long may that continue." In a paper titled "Singapore at 60," Morgan Stanley said the country has achieved extraordinary economic success by keeping in sync with global megatrends. In the early years of its independence, Singapore capitalized on manufacturing exports for job creation, inviting companies from around the world to set up manufacturing plants here. Those companies include U.S. IT giant HP (then known as Hewlett-Packard) , Texas Instruments and Japan's Seiko. "Then it embraced value creation – encouraging innovation and supporting local enterprises to flourish into national, regional and ultimately global champions of industry." Morgan Stanley said it believes the next step for Singapore story is "wealth creation," which would involve building on its established brand and economic success to further grow the country's capital and global financial standing. The city-state should use its "hub status" in areas such as energy, finance and tourism as well as continue to to adopt technological advancements such as artificial intelligence, autonomous vehicles, and humanoids to overcome constraints such as an aging population and to drive significant productivity gains, higher company valuations and potentially initial public offerings, the firm added. The final pillar that Morgan Stanley noted was equity market reform, which saw the country's monetary authority announce that it will $5 billion Singapore dollars ($3.9 billion) into the local stock markets. Of the SG$5 billion, SG$1.1 billion has been allocated to fund managers to place into small- and mid-cap stocks in Singapore. "We believe this could ignite significant interest and confidence in the Singapore stock market globally," the investment bank said. Sixty may be a time for most people to slow down, take life easy, and kick back, but not for Singapore, which can hopefully find its place in a new world order.
Bloomberg
14-07-2025
- Business
- Bloomberg
Lloyds, Aberdeen Tie Up With Crypto Bourse Archax for FX Trading
Lloyds Banking Group Plc and fund manager Aberdeen Investments have partnered with crypto exchange Archax to enable foreign-exchange contracts to be collateralized using digital assets, in a bid to drive down costs for trading rooms. The tie-up allows FX trades between Aberdeen and Lloyds using blockchain technology, which enables tokenized real world assets to be used as collateral. Under the initiative, digital tokens, backed by UK gilts as well as units of Aberdeen Investment's money market fund, have been issued, transferred, and held by UK-based Archax, according to a statement on Monday.
South China Morning Post
07-07-2025
- Business
- South China Morning Post
Aberdeen, BlackRock make case for US assets on tax cuts, earnings power
US assets will remain a key allocation for global money managers like Aberdeen Investments and BlackRock even as investors seek portfolio diversification by loading up on defensive sectors in Europe, China and Japan amid tariff and inflation challenges, strategists said. Tax incentives handed out by the US government could drive corporate earnings to another level, particularly among smaller companies. Tech companies have also stepped up hiring talent to overcome challenges from China in the global race for leadership in artificial intelligence, they added. The US House of Representatives passed the One Big Beautiful Bill on July 3, and it was headed to President Donald Trump for sign-off. The legislation provides substantial tax cuts and slashes several social safety-net programmes, helping the S&P 500 hit a record high this week. 'The profitability of listed companies in the [US] market is still good,' said Zhang Dongyue, Asia-Pacific head of multi-asset and investment solutions specialists at Aberdeen. 'Although the market has fluctuated greatly this year, some industries including consumer goods, medical care, energy, and recently technology have recovered.' 03:02 US House passes Trump's bill, sending it to White House for president to sign US House passes Trump's bill, sending it to White House for president to sign He also cautioned investors not to bet against the US dollar despite its recent weakness. The S&P 500 handed investors 6.8 per cent returns this year en route its record on July 3, according to Bloomberg data, while global stocks gained 10.2 per cent. This year, the US dollar has lost 10.6 per cent against its major peers, according to the DXY Index, as investors trimmed dollar-based assets. The S&P 500 rose 5.3 per cent during Trump's first presidential term.
Yahoo
30-06-2025
- Business
- Yahoo
Investors piled out of U.S. bond funds in Q2, but long-term Treasuries may soon get relief
While bond funds make up a small portion of the $28 trillion Treasury market, recent outflows show investors have become increasingly hesitant about long-term U.S. debt. Fixed-income experts told Fortune they're optimistic, however, about how loosening capital requirements can help major lenders act as a stabilizing force. A soaring national debt has added plenty of jitters to a Treasury market already reeling from tariff chaos, but there are signs that relief is coming to long-dated fixed income. For now, however, investors have piled out of long-term U.S. bond funds at the fastest rate since the early days of the COVID-19 pandemic, according to calculations from the Financial Times. Net outflows from funds with government and corporate debt totaled nearly $11 billion in the second quarter, the FT found using EPFR data, a stark contrast from average net inflows of roughly $20 billion over the past 12 quarters. While such funds make up a small portion of the $28 trillion Treasury market, the exodus shows investors have become increasingly hesitant about long-term U.S. debt, said Miguel Laranjeiro, investment director for municipal debt at Aberdeen Investments. 'Usually, that's because of fiscal policy rather than monetary policy, especially on the long end,' he told Fortune. Still, he's optimistic about what proposed regulatory changes could do for the market. Other fixed-income experts, meanwhile, warned not to look too far into the data, which can be volatile based on the timing of redemptions by various institutional investors. 'Near-term fund flows tell us very little other than validating near-term investor sentiment,' Bill Merz, head of capital markets research at U.S. Bank Asset Management, said in a statement to Fortune. There's no doubt the mood among fixed-income traders has been rocky, though. The yield on the 30-year Treasury, which rises as the market price of the bond declines, climbed above 5.1% in late May, hitting its highest level since the spring of 2007. Concerns about America's fiscal outlook have been front and center as Republicans work to pass President Donald Trump's 'big, beautiful' tax-and-spending bill, which the nonpartisan Congressional Budget Office estimates will add $2.8 trillion to federal deficits over the next decade. The pending legislation proved the final straw for Moody's, which in May became the last of the three major credit agencies to downgrade the U.S. from its top rung of borrowers. Goldman Sachs, meanwhile, partially validated the White House's claim that higher tariff revenue and economic growth from tax cuts would slash the debt. But its path remains unsustainable, economists from the investment bank said, as America's debt-to-GDP ratio approaches its post-World War II high. Long-term rates have been on a largely slow and steady decline this past month, however. Recent inflation readings have come in relatively cool, perhaps convincing investors they don't need as much compensation for the risk of surging prices eating into their returns. But yields rose slightly Friday afternoon after the Commerce Department reported the Fed's preferred inflation metric ticked higher last month as concerns remain about how tariffs will fuel price growth. And stocks got a brief shock when Trump said he had suspended trade talks with Canada. Recent volatility has JoAnne Bianco, senior investment strategist at BondBloxx Investment Management, advising clients to avoid long-dated government debt, like 20- and 30-year Treasuries, all together. 'You're not seeing the long end—the ultra-long end—work as the safe haven that it might have in the past,' she told Fortune. Currently, insurance companies and pension funds, who have obligations to pay investors over long periods of time, are among the few 'natural investors' in these types of securities, Laranjeiro said. That may change, however, after the Federal Reserve moved this week to boost bank participation in the Treasury market by loosening capital requirements for major lenders. Industry leaders like JPMorgan Chase CEO Jamie Dimon have argued current restrictions, instituted to prevent a repeat of the Global Financial Crisis, are overly onerous and prevent banks from providing liquidity during times of market stress. Such changes would not be without precedent, as the Fed also exempted Treasuries and bank reserves from the calculation of so-called supplementary leverage ratio—which curbs the amount of borrowed funds lenders can use to make investments—during the pandemic. Laranjeiro thinks it's a prudent move that can make government borrowing less dependent on foreign investors, whose holdings of U.S. debt are declining as a share of the overall market. Thomas Urano, co-chief investment officer at Sage Advisory, agreed that boosting domestic demand for U.S. debt could offset concerns about the market's ability to absorb increased issuance from the Treasury. 'I think that's what the bond market and the investor community [are] kind of pinning their hopes on,' he told Fortune. And if this change can help make fixed income boring again, investors might come crawling back. This story was originally featured on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
The Star
22-06-2025
- Business
- The Star
Clarity, selectivity and patience urged
THE global investment outlook is anything but straightforward, with economic policy shifts, political turbulence, rising geopolitical tensions and trade uncertainty all jostling for attention. Yet for those willing to dig deeper, fresh opportunities are emerging – provided investors tread carefully. At Aberdeen Investments, chief investment officer Peter Branner and chief economist Paul Diggle are urging investors to keep their heads and sharpen their focus. Billed as RM9.73 for the 1st month then RM13.90 thereafters. RM12.33/month RM8.63/month Billed as RM103.60 for the 1st year then RM148 thereafters. Free Trial For new subscribers only
