US Tariffs: Safeguarding Singapore in a New and Dangerous Era

The Trump administration's 'Liberation Day' tariffs underscore the grim reality that the era of rules-based globalization and free trade is over. Prime Minister Lawrence Wong spelt out the implications in Parliament on April 8. The transcript of his ministerial statement follows.

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We have known for some time that the world is in flux. The familiar signposts are fading. But the contours of a new global system have yet to take shape.

So we are in a period of transition – uncertain, unsettled and increasingly unstable.

The recent "Liberation Day" tariff announcements by the US confirm this stark reality: The era of rules-based globalization and free trade is over.

This marks a profound turning point. We are entering a new phase in global affairs – one that is more arbitrary, protectionist and dangerous.

For nearly 80 years since the end of World War II, America was the anchor for the free-market economies of the world. It championed free trade and open markets, and led efforts to build a multilateral trading system.

This World Trade Organisation (WTO) system ushered in decades of global growth and stability. It allowed trade to flourish and lifted millions out of poverty. It benefited the world and contributed to America's own economic strength.

And objectively, America continues to enjoy unrivalled economic heft. In fact, the US rebounded more quickly than other advanced economies from the Covid-19 pandemic; it has surged ahead of all its major competitors in the advanced industrial world.

But not all Americans feel this way about their economy. There are hollowed-out towns in what was once America's thriving industrial belt. There are workers whose jobs have disappeared, and those whose incomes have stagnated. They believe that the American economy is fundamentally broken.

Discontent was already visible in the 1990s, when protesters disrupted the WTO meeting in Seattle. Frustrations deepened following the global financial crisis of 2008, and more recently, after the Covid-19 pandemic.