Singapore's Economy Faces Trade Tensions with US: DBS Economist Warns of Technical Recession Risk

Published on 5.25.25

  Singapore's economy is facing increased uncertainty due to ongoing global trade tensions, particularly with the United States. The country's economic growth has been boosted by a strong first quarter, with its Gross Domestic Product (GDP) growing 3.9% from a year earlier. DBS senior economist Chua Han Teng believes that exporters will capitalize on temporarily lowered US tariffs by front-loading export orders, potentially avoiding a technical recession in the second quarter. This strategy is likely driven by companies such as Singapore's electronics and pharmaceuticals manufacturers, which have significant trade ties with the US. Uncertainties over sectoral tariffs remain, which could lead to "much weaker" economic growth in the latter half of the year. The country has warned of a risk of technical recession due to US tariff tensions, highlighting the interconnectedness of global trade relationships.

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