Tariffs, Trust, and Trade: Singapore’s Story

As a development economist, I’ve always understood trade not just as a driver of growth, but as a lens into how countries cooperate, compete, and co-create their futures. Sound trade policy—when done right—isn’t just about economic advantage. It’s about fairness, mutual respect, and the values we choose to uphold across borders.

In August 2020, I returned to Singapore in the middle of a pandemic. The world was in flux—borders closing, reopening, stalling again—but trade never truly stopped. That year, I joined the Ministry of Manpower (MOM), where I worked on Singapore’s Free Trade Agreements (FTAs), labour mobility, and our commitments under the WTO’s General Agreement on Trade in Services (GATS).

What often goes unnoticed is how deeply labour provisions are embedded in our trade architecture—covering commitments to fair treatment, mobility pathways, and non-discrimination. These agreements aren't just about goods and tariffs—they shape how people live, move, and work across borders. Trade agreements may look technical on the surface, but underneath, they’re social contracts between nations.

Singapore’s 27 Free Trade Agreements are more than economic tools—they’re frameworks for cooperation, mutual respect, and long-term partnership.

Why This Matters—Stakes behind the strategy

In today’s fractured geopolitical climate, sound trade policy can’t be taken for granted. Here's why these frameworks matter, especially for a small, open economy like Singapore:

✅ Trade powers livelihoods. Singapore is deeply dependent on global markets. We don’t have the luxury of a large domestic market to fall back on—our economic engine runs on openness. Trade supports jobs, ensures access to essential goods, and enables innovation by connecting us to global knowledge flows.

✅ Trade policy shapes human mobility. Labour mobility chapters in trade agreements directly affect who gets to move, work, and live across borders. These provisions influence the lives of professionals, migrant workers, and families. In my time at MOM, I saw how FTAs could open pathways—or close doors—for people across industries and skill levels.

✅ Trade frameworks build resilience. COVID-19 showed us the fragility of supply chains. Strong trade relationships are a buffer against shocks—from pandemics to geopolitical tensions. They enable countries to pivot, adapt, and rebuild faster.

✅ Trade sets the tone for digital and future economies. From AI governance to data flows, from e-commerce to digital ID interoperability—trade agreements are increasingly shaping the rules of engagement in the digital realm. If countries don’t engage thoughtfully now, they risk getting locked out of the global norms of tomorrow.

✅ Trade is political—but it should also be principled. As PM Lawrence Wong recently pointed out, Singapore imposes zero tariffs on U.S. imports, while the U.S. applies universal tariffs to Singapore—even though we run a trade deficit. “These are not actions one does to a friend,” he said. Trade decisions send signals. They reflect how seriously nations take their partnerships.

The Numbers Speak Too

📌 Singapore’s top trading partners in 2024 were Mainland China, the United States, and Malaysia, with exports totaling S$94.4B, S$69.9B, and S$57.6B respectively.

📌 Singapore is part of RCEP—the world’s largest FTA, covering nearly a third of global GDP and population, enabling deeper regional integration and supply chain resilience.

📌 The U.S.-Singapore FTA, now in its 20th year, remains one of our most actively used. It’s not just about history—it’s about how we build on what works.

📌 The upgraded China-Singapore FTA, which came into effect in December 2024, modernises key areas of cooperation—including services and digital trade—ensuring our economic ties remain future-proof.

📌 Singapore's total merchandise trade expanded by 6.6% to S$1.3 trillion in 2024, up from S$1.2 trillion in 2023. This growth reflects the continued relevance of trade in supporting economic resilience and expansion.

📌 Singapore’s manufacturing sector grew by 7.4% year-on-year in Q4 2024, led by electronics and transport engineering—key clusters linked to global supply chains.

📌 Services-producing industries grew by 4.6% in Q4 2024, with strong gains in wholesale trade (6.7%) and finance & insurance (6.1%), highlighting trade’s spillover effects across sectors.

What It All Comes Back To

Trade can seem abstract—even transactional. But behind every policy line is a negotiation about values, a vision for the future, and a vote of confidence in one another.

When we think about trade only as a numbers game, we miss the bigger picture. Trade policy is also about dignity—about how we treat workers, how we respect partners, how we build systems that enable progress, not exclusion.

And for a country like Singapore—without natural resources, without a vast domestic base—trade isn’t a luxury. It’s existential.

If we, as a global community (yes, I still believe this exists!) want to stay competitive, connected, and relevant in an increasingly unpredictable world, then we must continue to pursue trade policy that is bold, fair, and forward-looking.

Because at its best, trade is not just about efficiency—it’s about equity. Not just about growth—but about shared prosperity.