Impact of US Tariffs on Singapore Economy
Ministry of Trade and IndustrySpeakers
Summary
This question concerns the impact of United States tariffs on solar panels, washing machines, steel, and aluminium on Singapore’s economy and strategy as raised by Mr Gan Thiam Poh. Minister for Trade and Industry Chan Chun Sing stated that affected exports totaled S$240.6 million in 2017, representing 1.4% of domestic exports to the US and 0.09% globally. He noted that while tariffs increase prices for importers, the direct negative impact on Singapore’s economy is limited because these products represent a modest share of total domestic exports. The government has registered concerns with relevant United States departments and is consulting on potential exemptions while monitoring the specific impacts on affected companies within Singapore. Minister for Trade and Industry Chan Chun Sing concluded that Singapore will continue to uphold the rules-based multilateral trading system and resist protectionist practices to safeguard national interests.
Transcript
9 Mr Gan Thiam Poh asked the Minister for Trade and Industry (a) whether the tariffs imposed by the US on solar panels, washing machines, steel and aluminium have any impact on the Singapore economy; (b) what is the estimated impact on businesses; and (c) how will it affect our economic strategy.
Mr Chan Chun Sing: The United States (US) announced a series of safeguard measures in the form of tariffs on solar panels and washing machines under section 201 of the 1974 Trade Act in January 2018, as well as steel and aluminium under section 232 of the 1962 Trade Expansion Act in March 2018.
In 2017, Singapore's domestic exports to the US were S$228.9 million for solar cells and modules, and S$36,000 for washing machines. Domestic exports to the US totalled S$4.6 million for steel, and S$7.1 million for aluminium. In aggregate, these exports made up 1.4% of Singapore’s total domestic exports to the US, and a smaller 0.09% of Singapore’s total domestic exports to the world.
The US tariffs have the effect of making the prices of these products more expensive to US importers, which may reduce their demand for overseas products. Given the modest share that the products affected by the US tariffs have as a percentage of Singapore's total domestic exports, the direct negative impact of the US tariffs on the Singapore economy is limited.
Nonetheless, we are closely monitoring developments on these safeguard measures, which do impact some companies in Singapore. Singapore has registered our concerns with the relevant US departments and consulted with the US on possible exemption from the safeguard measures.
As a small and open economy, having free and connected markets is critical for Singapore. It is important that Singapore and like-minded partners uphold the rules-based multilateral trading system and ensure that such safeguard measures do not become entrenched and turn into barriers to trade.
Even as Singapore continues to build stronger links and collaborate closely with our trading partners to boost growth and create jobs, we will continue to safeguard our trade interests and resist protectionist practices which could disrupt the flow of global commerce.