US tariffs prompt Singapore to launch review of economic strategy, competitiveness, AI

The city state launched a broad economic review to tackle competitiveness, and AI, as authorities warn of a looming slowdown from US tariffs

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Singapore’s central bank said the effective US tariff rate on the city state’s exports rose to 7.8 per cent in July. Photo: AFP

Published: 7:19pm, 4 Aug 2025Updated: 8:06am, 5 Aug 2025

Singapore is launching a broad review to secure the city state’s future as a trade and financial hub, announcing committees on Monday to look into areas such as competitiveness, artificial intelligence and how restructuring would affect people.

The economic strategy review will have five committees, each chaired by two government ministers and including members from the business, academic and social sectors, and they are due to publish their recommendations by mid-2026.

“We must reinforce Singapore’s competitive positioning as a key hub for trade and investment and remain relevant to the global economy,” Deputy Prime Minister and Trade Minister Gan Kim Yong told at a press conference.

Singapore’s Deputy Prime Minister and Minister of Trade and Industry Gan Kim Yong said the city state “must reinforce its competitive positioning as a key hub for trade and investment”. Photo: Reuters

The review comes as US tariffs and global trade tensions threaten the Southeast Asian nation’s growth, where trade is three times the size of its gross domestic product.

Singapore’s exports to the US remain subject to a 10 per cent baseline tariff after US President Donald Trump set new tariffs for dozens of countries, but authorities are still waiting for clarity on proposed sector-specific tariffs in areas such as pharmaceuticals. Last week, the central bank said the effective US tariff rate on Singapore’s exports rose to 7.8 per cent in July from 6.8 per cent in April on the back of steel and aluminium tariff increases.

The Monetary Authority of Singapore held its policy settings steady last week, adopting a wait-and-see approach to trade tensions after easing at its previous two reviews this year.

While the economy grew at a better-than-expected annual rate of 4.3 per cent in the second quarter, according to preliminary data, authorities have warned that growth is likely to slow as the impact of front-loading of orders to beat the US tariffs tapers off.

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