Asian economies need to stay agile and avoid tit-for-tat tariff retaliation, a deputy managing director of the Monetary Authority of Singapore said on Friday.
At the meeting, Robinson, who is also a MAS chief economist, said retaliatory tariffs shift supply negatively. Reuters reported that he warned they would worsen the growth-inflation trade-off and complicate monetary policy. “They should continue to heed the old advice to avoid throwing rocks into their own harbours[8], and intensify regional trade integration initiatives including in digital and services trade and investment.” he said.
Robinson said protectionism and import taxes hurt resource allocation and lower consumer welfare as households face higher prices and fewer choices. “Both the targeted and the tariff-imposing economies suffer,” he noted.
Singapore, which has a free-trade pact with the United States and runs a trade deficit, has been hit with a 10% baseline tariff by Washington. Other Southeast Asian states face threats of higher tariffs, delayed until July, with a 10% interim rate in place.
Singapore’s economic slowdown raises technical recession risk
The report said that on Thursday, Singapore’s economy shrank by 0.6% on a seasonally adjusted basis in the first quarter of 2025. That raised the risk of a technical recession and stoked worries about job losses and slower hiring. Even with 3.9% year-on-year growth, officials warned of downside risks from global trade tensions, especially after the US imposed a 10% baseline tariff.
Beh Swan Gin, Permanent Secretary at the Ministry of Trade and Industry, said two consecutive quarters of contraction are likely. But he added that this may not mean a full-year recession. The ministry kept its growth forecast for 2025 at 0.0% to 2.0%, saying recent easing of trade tensions was mildly positive; however, global demand remains uncertain.
The MAS eased policy settings at its review sessions in January and April this year. After the GDP figures were released on Thursday, Robinson said he believes the current monetary policy stance is appropriate.
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