Compared with neighbouring countries like Indonesia, Malaysia, the Philippines, Thailand and Vietnam, Singapore is likely most vulnerable to an external slowdown caused by the tariffs, said Mr Suan Teck Kin, head of research at UOB.
If the US imposes sector-specific tariffs, such as on pharmaceuticals or semiconductors, the direct drag to Singapore could be particularly pronounced, he added.
Growth has already softened in early 2025, with key sectors such as manufacturing, trade and logistics slowing down.
Ms Selina Ling, chief economist of OCBC, said the broad-based nature of the tariffs may mean there are knock-on implications on Singapore’s shipping, logistics and financial hub activities.
If China and Southeast Asian countries see slower trade and economic growth, Singapore will suffer, she said.
A lot of the supply chain, trade and funding activities relating to these countries happen in Singapore, she added.
Investment into Singapore may also dip, said Ms Sheana Yue, an economist at Oxford Economics, pointing to tariffs impacting trade and business decisions.
The volume of trade going through Singapore may be reduced as the demand for goods from countries with high tariffs falls. US demand for Singapore goods would also fall.
POTENTIAL BENEFITS
However, analysts pointed to possible silver linings. With tariffs on Singapore goods remaining relatively low, the country could emerge as a more attractive source of imports for US buyers seeking alternatives to heavily taxed suppliers.
While Singapore’s exports to the US could decline, the drop is likely to be less severe than other Asian exporters, said Ms Yue.
This could even increase Singapore’s share of US imports, especially since a “fair share” of its exports are exempted from tariffs.
However, Singapore’s small land area means it cannot easily scale up output to meet any increased demand, and this would limit a potential increase in exports.
Its high operating and labour costs may also temper its attractiveness as a supply chain alternative, said Mr Yeap Jun Rong, a market strategist at trading platform IG Asia.
