SINGAPORE: Singapore is negotiating concessions with the United States for its pharmaceutical exports while ensuring it continues to have access to advanced artificial intelligence (AI) chips.
In a transcript published by the trade ministry on Sunday (Apr 27), Trade and Deputy Prime Minister Gan Kim Yong shared details of the discussion and consultation between the two nations following a call with US Secretary of Commerce Howard Lutnick on Friday (April 25).
Mr Gan noted that Mr Lutnick raised concerns about US export controls on chips, which are affecting “not just to Singapore, but generally”. Mr Lutnick also expressed a desire to explore “creative solutions” to strengthen bilateral trade, particularly regarding critical exports from Singapore to the US.
Mr Gan said, “We took the opportunity to explain to Secretary Lutnick about Singapore’s export control system and how we have been working together with the US counterparts in this area,” adding that the city-state does not condone companies that take advantage of their presence in Singapore to undermine export controls.
Reuters reported that pharmaceuticals, a sector that US President Donald Trump has threatened to impose tariffs on, account for over 10% of Singapore’s exports to the US, Mr Gan explained. He also noted that they discussed the issue of the city-state’s access to high-end AI chips.
Mr Gan said, “There is progress being made in our discussion between Singapore and the US.” However, he added, “I must stress that it is not a done deal yet. There is still a lot of negotiation that we need to engage with the US, but it is a good start, and this whole process is really based on the basis of trust between the US and Singapore, which has taken us many, many decades to build. I think now it is time for us to leverage on this trust to progress the bilateral relationship between Singapore and the US.”
Despite having a bilateral free trade agreement with the US, Singapore still faces a 10% levy on its exports, which Mr Gan said is “not likely to be subject to negotiation” and will “stay for the long term”.
In early April, Prime Minister Lawrence Wong said that while Singapore may or may not avoid a recession this year, the country’s economy will still be “significantly impacted”, with slower growth leading to “fewer job opportunities and smaller wage increases for workers”.
Singapore’s central bank later downgraded the city-state’s gross domestic product (GDP) growth forecast to between 0% and 2%, as expected by 14 economists surveyed by Bloomberg. /TISG
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