Deputy Prime Minister urges resilience and skills upgrading as tariffs and AI reshape global trade.

Singapore must brace for rising global uncertainties caused by tariffs and structural economic shifts, Deputy Prime Minister Gan Kim Yong said at the annual MTI Economic Dialogue on August 25.

Rising Tariff Pressures

DPM Gan cautioned that the United States’ reciprocal tariff policy, launched on April 2, has created ripple effects across global supply chains. Although Washington has secured deals with several trading partners, negotiations with China, India, and Switzerland remain unresolved. Tariffs on semiconductors and pharmaceuticals—key Singapore exports—may soon follow, potentially squeezing margins, slowing corporate spending, and dampening global growth.

Secondary Effects on Trade

Gan explained that tariff realignments can redirect trade flows. Countries buying more U.S. agricultural products, for instance, may reduce imports from other partners. Similarly, firms pledging investment in the U.S. might scale back elsewhere. To cope, companies are diversifying supply chains and markets, underscoring the need for Singapore to stay nimble.

Economic Resilience Taskforce Initiatives

To manage near-term challenges, the Singapore Economic Resilience Taskforce (SERT) has been monitoring tariff impacts and supporting businesses. Measures include the Business Adaptation Grant, launching in October, to help companies adjust to the new landscape, and a Graduate Industry Traineeships programme that equips fresh graduates with relevant experience for long-term employability.

Preparing for Structural Shifts

Looking beyond tariffs, Gan highlighted technology—particularly artificial intelligence, robotics, and automation—as a major driver of structural change. He stressed the importance of investing in practical AI applications to raise productivity, while identifying job roles likely to be disrupted. Upskilling and reskilling schemes will target workers for higher-value roles in the future economy.

Supporting Workers at Risk

Singapore has refreshed its SkillsFuture framework with initiatives such as the Level-Up Programme, designed to help mid-career professionals reboot their skills. The government also introduced the SkillsFuture Jobseeker Support Scheme earlier this year to provide temporary financial aid for unemployed workers, while studying broader system-level support to strengthen re-employment.

Resilience and Opportunity

Despite the challenges, Gan expressed confidence in Singapore’s ability to adapt. The Republic’s small but agile economy, coupled with world-class infrastructure and connectivity, gives it an edge in navigating global turbulence. “Singapore is in a strong position to find opportunities even in the midst of these challenges,” he said.

Gan’s message underscores both the risks and resilience of Singapore’s economy. While tariffs and technology shifts pose real threats, Singapore’s strategy of adaptation, skills upgrading, and long-term planning reflects a proactive approach. For Singaporeans and regional partners, the focus remains on turning uncertainty into opportunity.

Sources: Straits Times (2025) , The Star (2025)

Keywords: Singapore Economy, Tariff Uncertainty, Gan Kim Yong, AI Transformation, Economic Resilience, Skills Upgrading