Singapore’s export growth is predicted to decelerate in the second half of 2025, following a 25% year-on-year surge in April, according to the Institute of Chartered Accountants in England and Wales (ICAEW). The slowdown comes as the initial boost from front-loading exports to the US wanes. Despite having the lowest US tariffs among ASEAN economies at 10%, Singapore remains highly susceptible to reduced US demand, with over 6% of its GDP tied to exports to the US.
Exports are crucial to Singapore, comprising 124% of its GDP. The anticipated global export downturn is already impacting the local economy, as evidenced by declining employment growth in export-reliant sectors like professional services, manufacturing, and information and communications in Q1.
However, Singapore’s fiscal and monetary strategies, including CDC vouchers and LifeSG credits from Budget 2025, are expected to bolster domestic consumption and business support. Additionally, favourable inflation trends, with both headline and core inflation projected to average below 1% in 2025, could enhance real incomes. This scenario may allow the Monetary Authority of Singapore to ease the Singapore dollar’s exchange rate slope further.
Despite these challenges, the ICAEW report suggests that recession risks are low, buoyed by the recent surge in goods exports and strategic shipment rerouting to the US. Singapore’s GDP growth is forecasted to slow to 1.8% in 2025, down from 4.4% in 2024. The report also highlights regional economic insights, noting Malaysia’s proactive monetary policy and China’s tariff-related uncertainties.
“`
