The Monetary Authority of Singapore (MAS) has highlighted concerns over the economic repercussions of U.S. tariffs. According to their macroeconomic assessment report, these tariffs are expected to have a multiplier effect, negatively impacting Singapore's income and demand. Beyond the direct impact of a 10% tariff on exports to the U.S., Singapore's second-largest export market, the broader tariffs imposed by the U.S. on other countries will also indirectly affect Singapore.
The MAS noted that these tariffs, essentially production taxes on manufacturers and exporters, will affect corporate revenues and profits, ultimately constraining Singapore's overall demand. The Singaporean government has previously warned of the global ripple effects of the trade war, emphasizing the uncertainty and potential for economic downturn in its trade-reliant economy.
Earlier this month, MAS eased monetary policy and the government revised the GDP growth forecast for the year to 0%-2%, citing tariffs as a significant factor. By 2024, the U.S. is projected to account for 11% of Singapore's exports, with approximately 55% of these exports subject to the 10% tariff.
