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US tariffs prompt Singapore to launch review of economic strategy, competitiveness, AI
The city state launched a broad economic review to tackle competitiveness, and AI, as authorities warn of a looming slowdown from US tariffs
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Malaysia imposes trade permits for US-linked AI chip shipments
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A win for ‘sovereign rights’? Malaysia agrees 19% tariff deal with Trump
Singapore dodges recession as economy grows 4.3% amid tariff uncertainty
Reuters
Published: 7:19pm, 4 Aug 2025
Singapore is launching a broad review to secure the city state’s future as a trade and financial hub, announcing committees on Monday to look into areas such as competitiveness, artificial intelligence, and how restructuring would affect people.
The economic strategy review will have five committees, each chaired by two government ministers and including members from the business, academic and social sectors, and they are due to publish their recommendations by mid-2026.
“We must reinforce Singapore’s competitive positioning as a key hub for trade and investment and remain relevant to the global economy,” Deputy Prime Minister and Trade Minister Gan Kim Yong told at a press conference.
Singapore’s Deputy Prime Minister and Minister of Trade and Industry Gan Kim Yong said the city state “must reinforce its competitive positioning as a key hub for trade and investment”. Photo: Reuters
The review comes as US tariffs and global trade tensions threaten the Southeast Asian nation’s growth, where trade is three times the size of its gross domestic product.
Singapore’s exports to the US remain subject to a 10 per cent baseline tariff after US President Donald Trump set new tariffs for dozens of countries, but authorities are still waiting for clarity on proposed sector-specific tariffs in areas such as pharmaceuticals. Last week, the central bank said the effective US tariff rate on Singapore’s exports rose to 7.8 per cent in July from 6.8 per cent in April on the back of steel and aluminium tariff hikes.
The Monetary Authority of Singapore held its policy settings steady last week, adopting a wait-and-see approach to trade tensions after easing at its previous two reviews this year.
While the economy grew at a better-than-expected annual rate of 4.3 per cent in the second quarter, according to preliminary data, authorities have warned that growth is likely to slow as the impact of front-loading of orders to beat the US tariffs tapers off.
Malaysia
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Malaysia imposes trade permits for US-linked AI chip shipments
Latest move comes with Kuala Lumpur facing 25 per cent tariffs announced by US leader Donald Trump
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Joseph Sipalan
Published: 12:53pm, 14 Jul 2025Updated: 4:05pm, 14 Jul 2025
Malaysia said on Monday it would require trade permits for all high-performance chips meant for artificial intelligence (AI) and sourced from the United States, as Kuala Lumpur scrambles to negotiate down punitive American tariffs set to kick in on August 1.
Last week, US President Donald Trump slapped a 25 per cent tariff on Malaysia, part of a broader move by the mercurial leader to address what he described as “unsustainable trade deficits” between the world’s largest economy and its trade partners.
Trump’s announcement came just weeks after Malaysia had affirmed that it “stands firm” against attempts to circumvent US export controls on chips to American rival China, following allegations that Chinese engineers had rented data centres packed with high-end Nvidia chips in the Southeast Asian country to train an AI model.
On Monday, Malaysia’s Ministry of Investment, Trade and Industry (MITI) said in a statement that all exports, transshipments and transits of high-performance AI chips of US origin would need to come with a Strategic Trade Permit “effective immediately”.
The new regulation will require individuals or companies to notify Malaysian authorities at least 30 days before moving any items not expressly listed in the Strategic Items List (SIL) – which covers items such as goods and technology that could potentially be used for military applications.
“This initiative serves to close regulatory gaps while Malaysia undertakes further review on the inclusion of high performance AI chips of US origin into the SIL,” the ministry said in a statement.
Malaysia’s Anwar slams US tariffs, calls for stronger inter-Asean trade
The mandatory permit is the latest measure taken by Kuala Lumpur, which caved to pressure from Washington in March to tighten regulations on semiconductor shipments following reports that advanced Nvidia chips had been shipped to China from Singapore via Malaysia.
Last month, Malaysia’s trade authorities launched an investigation into allegations that four Chinese engineers, who travelled from Beijing to Malaysia in March, had used local data centres housing chips similar to those restricted by the US to train an AI model.
Each engineer allegedly carried a suitcase with hard drives containing 80 terabytes’ worth of spreadsheets, images and video clips that were fed into 300 servers operating on Nvidia chips to build their AI model before bringing back the data to China, The Wall Street Journal reported.
MITI on Monday said it would take “strict legal action” against any attempt by any individual or company to skirt export controls or engage in illicit trade activities.
The ministry added that all entities operating in Malaysia must comply with the “relevant international obligations to avoid any secondary sanctions on their businesses”.
“MITI remains committed to preserving a safe, secure, transparent and rules-based trading environment with all its trade partners, and will not tolerate the misuse of Malaysia’s jurisdiction for illicit trading activities,” the ministry said.
In a batch of letters sent out last Tuesday, Trump announced tariffs of 40 per cent on exports to the US from Myanmar and Laos, 36 per cent on Cambodia and Thailand, 32 per cent on Indonesia and 25 per cent on Malaysia.
Two days later, he sent similar letters announcing tariffs of 25 per cent on Brunei and 20 per cent on the Philippines.
The latest salvoes have triggered widespread anxiety among Southeast Asian economies, most of which are reliant on US demand and whose industries are deeply intertwined with American supply chains.
