Singapore's economic resilience measures amid trade tensions

[SINGAPORE] Singapore is currently in discussions with financial institutions to enhance financing options for local enterprises, following concerns over cancelled or delayed orders and payment uncertainties arising from persistent global trade tensions.

Speaking at a media doorstop on Friday (May 16) during the Singapore Economic Resilience Taskforce (SERT) meeting, Deputy Prime Minister Gan Kim Yong told the Singapore Business Review that authorities are in active talks with banks and reviewing existing financing schemes to assess their adequacy and explore potential improvements.

“We are preparing schemes that can be deployed if necessary, to address specific challenges faced by businesses,” Mr Gan said, noting that disruptions to orders are impacting both revenue streams and cash flow. He acknowledged that working capital has become a pressing issue for many companies and emphasized the government’s commitment to providing timely support.

The backdrop to these concerns is the ongoing trade dispute between the United States and China, which has disrupted global supply chains and left Singaporean businesses vulnerable to shifting tariffs and uncertain trade policies. This climate of unpredictability has had a cascading effect on short-term financial stability and long-term strategic planning across various industries.

While Mr Gan welcomed the recent move by the US and China to reduce tariffs, describing it as “encouraging,” he cautioned that the path forward remains uncertain, especially as the 90-day reciprocal tariff pause nears its conclusion. “I think the journey will be quite long. It will take time for both countries to reach an agreement—if they ever do,” he said.

Beyond financial interventions, the government is also focusing on strengthening business resilience through innovation and market diversification. This includes encouraging local firms to explore emerging opportunities in Southeast Asia and the Middle East, moving beyond the US-China economic axis.

SERT has also been engaging with businesses, workers, and households to better understand the broader impact of trade-related disruptions. Mr Gan said concerns about job security and the rising cost of living have been consistently raised during these consultations.

The government is responding by intensifying efforts to create new employment opportunities and expanding training programmes aimed at equipping workers with adaptable skillsets. Schools have also been brought on board to support job placement initiatives.

Addressing the issue of rising living costs, Mr Gan pointed to the recent distribution of a new tranche of S$500 Community Development Council (CDC) vouchers. These vouchers are intended to provide immediate relief to households by offsetting essential living expenses amid a slower economic outlook. “These measures are part of our broader effort to help Singaporean households manage the challenges of an economic slowdown,” he said.