S'pore Raises 2025 Growth Forecast But Warns Of Uncertainty From US Tariffs

MTI Increases Forecast To 1.5% To 2.5% After Front-Loading Lifts Export-Oriented Sectors

- Ovais Subhani

Singapore raised its 2025 economic growth forecast on a better-than-expected performance in the first half of the year, but warned that the outlook remains clouded owing to US tariffs, with risks to the economy tilted to the downside.

The gross domestic product (GDP) growth forecast was raised to 1.5 per cent to 2.5 per cent, from an earlier range of 0 per cent to 2 per cent, the Ministry of Trade and Industry (MTI) said on Aug 12.

"This (upgrade) largely reflects the better-than-expected performance of the Singapore economy in the first half of 2025," it said in a statement.

The move came after the economy posted a surprisingly high year-on-year growth of 4.4 per cent in the second quarter of 2025, following a 4.1 per cent gain in the first three months, taking first-half growth to 4.3 per cent.

On a seasonally adjusted quarterly basis, the Singapore economy expanded by 1.4 per cent in the second quarter, rebounding from the 0.5 per cent contraction in the first quarter.

MTI made the earlier forecast in April, days after US President Donald Trump announced his "reciprocal tariffs" policy that threatened to impose unprecedented duties on almost all exports to the world's largest economy.

However, most tariff rates have been negotiated at much lower levels since then.

In the meantime, companies worldwide also rushed shipments to get ahead of the US tariffs. That resulted in an unseasonal surge in manufacturing and exports.

The phenomenon, known as front-loading, pushed Singapore's key exports growth up by 5.2 per cent year on year in the first six months of the year - again much higher than the 1 per cent to 3 per cent range forecast by Enterprise Singapore.