Singapore’s Economic Outlook Brightens Amid Global Headwinds

SINGAPORE, Sept 6 – Singapore has upgraded its 2025 GDP growth forecast to a range of 1.5% to 2.5%, up from the previous 0.0% to 2.0%, following stronger-than-expected economic performance in the second quarter. The Ministry of Trade and Industry reported a 4.4% year-on-year growth in Q2, slightly surpassing earlier estimates. This improvement was driven by a 1.4% quarter-on-quarter expansion, reversing the 0.5% contraction in Q1.

Economists surveyed by the Monetary Authority of Singapore (MAS) have also upgraded their growth expectations to 2.4%, up from 1.7% in the previous quarter. The revised outlook reflects robust performance in manufacturing and exports, as well as easing trade tensions. However, concerns persist over geopolitical risks and the impact of U.S. tariffs on Singapore’s trade-dependent economy.

Despite the positive revisions, the government has cautioned that the global economic environment remains uncertain. The U.S. has imposed a 10% tariff on Singaporean goods, including semiconductors and pharmaceuticals, which could affect trade flows. Prime Minister Lawrence Wong highlighted these concerns during his National Day Rally speech, emphasizing the need for diversification and resilience in Singapore’s economic strategies.

In response to these challenges, Singapore is exploring new trade partnerships. The Future of Investment and Trade Partnership (FIT-P), a coalition of small and medium-sized nations including Singapore, the UAE, and New Zealand, aims to promote trade openness and rules-based international trade. The initiative seeks to enhance digital trade and improve efficiency in cross-border transactions.

Overall, while Singapore’s economic outlook has improved, the government remains vigilant in addressing external risks and is actively pursuing strategies to maintain growth and stability.