Singapore exports likely to slow with front-loading to pre-empt tariffs set to fade

Record drop in US imports seen as telltale sign of what's in store for export-driven economies

- Ovais Subhani

An unusual spike in exports from Singapore and other Asean countries, prompted by fears of higher tariffs threatened by US President Donald Trump, may have run its course.

Analysts believe the record plunge in US imports in April is a telltale sign of what is in store for export-driven economies like Singapore. Japanese investment bank Nomura expects a double-digit decline in export growth across Asia in the second half of 2025.

With manufacturing activity already sputtering across Asean, Bank of America sees small and open economies like Malaysia, Singapore, Thailand and Vietnam taking the biggest hit in terms of immediate economic growth loss.

Hopes are now pinned on the latest round of US-China trade talks that began in the UK on June 9.

A successful conclusion of the talks may raise expectations of similar outcomes for deals being negotiated with other US trading partners that face harsh tariffs of up to 50 per cent from July 9. The date marks the end of the 90-day pause on Mr Trump's so-called reciprocal tariff plan announced on April 2.

But analysts warned that the back and forth on tariffs by the US President means any deal will be vulnerable to policy whiplash in the future.

For instance, Mr Trump earlier in June raised steel and aluminium tariffs to 50 per cent from 25 per cent, jeopardising his trade deal with the UK - the only pact post-April 2 - that assured zero tariffs on British metals.

The bump in exports so far in 2025 has been fuelled by the so-called phenomenon of front-loading - a new buzzword which basically means a surge in orders from importers aimed at pre-empting the cost impact of higher tariffs.

The phenomenon started to become evident from November onwards after Mr Trump won re-election. On the campaign trail, Mr Trump had promised to impose a 60 per cent tariff on China and 10 per cent to 25 per cent on other trading partners.