New task force to address impact of US tariffs will focus on engagement, information sharing: DPM Gan

SINGAPORE – A new task force set up to address uncertainties following the announcement of new US tariffs will engage the private sector to better understand their concerns, challenges and potential moves.

Information sharing, communication and transparency will also be a key focus, said Deputy Prime Minister Gan Kim Yong.

DPM Gan, who chairs the task force newly announced by Prime Minister Lawrence Wong, told Parliament on April 8 that the group is still working out its detailed composition and its plan going forward.

PM Wong had

announced the new task force during a ministerial statement

in response to US President Donald Trump’s April 2 announcement of a suite of universal tariffs, including a 10 per cent duty on Singapore. The measures will kick in on April 9.

The new task force aims to help businesses and workers address immediate uncertainties, strengthen resilience, and better adapt to the new economic environment, PM Wong said.

It will comprise the economic agencies, as well as the Singapore Business Federation, Singapore National Employers Federation and the National Trades Union Congress.

Leader of the Opposition and Workers’ Party chief Pritam Singh had asked for more details on the task force.

DPM Gan, who is also the Trade and Industry Minister, said the task force will gather information from the ground through private sector representatives, understand the challenges faced by enterprises, and discuss how they can be further supported in navigating these uncharted waters.

The union representatives are included as it is expected that jobs may be affected, though not immediately.

“In the medium to longer term, I think there will be a major restructuring of the economy that will result in the restructuring of the workforce as well,” said DPM Gan.

As PM Wong emphasised in his speech, the focus on training workers is the key to Singapore’s transformation journey, he added.

Hence, unions, employers and enterprises will play a key role.

The main guiding principle of the Government – and the task force – will be to remain as transparent as possible.

“When we know something important, we’ll share with the population, with the businesses, with the workers, with the unions and with members. And when we don’t know yet, we’ll tell you honestly we do not have the information yet,” said DPM Gan.

As it is still early days, it will take time for the Government to get a better understanding and assessment of the total impact of the tariffs and what will come, said DPM Gan.

Going forward, the authorities will also have to account for the reactions of other countries – not just the US – which will add to the potential impact on Singapore’s economy, he added.

Singapore is reaching out to its trading partners to share information and its assessment of the situation.

It is also looking to find different ways of working together to continue to do business with its partners, and continue to provide opportunities for businesses and enterprises, said DPM Gan.

PM Wong added that, as the situation is still unfolding, the task force will continue to engage businesses and eventually work out what additional measures may be needed.

“We will continue the review and the monitoring of the global situation, and, if there is a need, we will provide further updates to Singaporeans as and when we are ready, and as and when there is a need to,” he said.

WP MP Gerald Giam (Aljunied GRC) pointed to lower tariffs imposed on Singapore, compared with regional competitors like Taiwan, South Korea and Malaysia, that could present a near-term cost advantage for Singapore companies exporting semiconductors, telecommunications equipment and electronics to the US.

He asked if the authorities were stepping up efforts to help Singapore companies secure US demand in these areas before global buyers reorganise their supply chains and lock in new sourcing arrangements.

In response, DPM Gan said this is part and parcel of the task force’s strategy, as it is looking at both the shorter term and the longer term.

Some of such supply chain restructuring will take some time to happen, and will take place in the medium to longer term, as the authorities work with the industries to attract more investments into Singapore, he added.

But one also has to bear in mind that more investments into Singapore and taking advantage of a lower tariff will shift the trade balance between the US and Singapore, said DPM Gan.

“At some point in time, you’ll find that we are also going to face challenges as well. So we have to exercise some care in organising this, but... we will continue to explore,” he added.

He pointed out that some components that have to be purchased may also be more expensive owing to the duties, while some economies that Singapore sells to may also, in turn, be exporting to the US.

If they are faced with tariffs, their demand from Singapore may be lower.

“This is the entire global chain effect. So we should not look at it just simply from any particular single segment of trade, because (the tariffs are) going to change the entire playing field,” said DPM Gan.

The task force will also focus on engaging the private sector to have a sense of where they are moving their pieces, such as their production bases or purchasing strategy.

“All these are still in flux today, because everyone is still negotiating, and they are still thinking through what they need to do,” DPM Gan said.

“And particularly in semiconductors, it is a very complex supply chain, and if we move one piece, you need to move the entire ecosystem. So it’s not so easy to adjust and to reconfigure the semiconductor ecosystem.”