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[SINGAPORE] Anxieties over the deepening of a global trade war were stoked by US President Donald Trump’s Wednesday (Apr 2) announcement of universal tariffs of 10 per cent for all American imports, in addition to higher tariffs for certain countries.

While past tariffs have targeted major US trade partners such as China, Canada and Mexico, this round saw hefty tariffs levied on smaller South-east Asian nations as well. Tariffs on Cambodia stood at 49 per cent, while tariffs on Vietnam were 46 per cent. 

Singapore was not spared Trump’s sweeping 10 per cent baseline tariff, despite being a close US ally. Moreover, the city state could suffer further from the economic fallout of slower global trade given its open, trade-dependent economy.

Here is how governments and analysts reacted on Thursday.

International reactions

China 

• Beijing said it “firmly opposes” the new tariffs on its exports, and urged Washington to “immediately cancel” them. It has vowed retaliation to “safeguard its own rights and interests”.

• The Commerce Ministry said that the tariffs “do not comply with international trade rules, and seriously harm the legitimate rights and interests of the relevant parties”.

Japan

• Japanese Trade Minister Yoji Muto criticised the 24 per cent levies on its exports as “extremely regrettable”, and said he has urged Washington to cancel them. 

• Yoshimasa Hayashi, Japan’s chief Cabinet secretary, said the tariffs may contravene World Trade Organization rules as well as the US and Japan’s trade treaty.

Australia

Thailand

Switzerland

• The Swiss government will quickly decide its response to 31 per cent tariffs levied on the country, said President Karin Keller-Sutter. She said the country will prioritise its “long-term economic interests” and that respect for international law and free trade are “fundamental”.  

Canada

Germany 

• The German Association of the Automotive Industry said the tariffs would “only create losers” and added that the European Union must “act together” while continuing to signal willingness to negotiate. 

• The German chemical industry, which counts the US as its largest export market, urged the EU to “keep a cool head”, stressing that “an escalation would only worsen the damage”.

UK 

• British Secretary of State for Business and Trade Jonathan Reynolds said the country remains committed to securing an economic deal with the US which could mitigate its 10 per cent tariff on British exports. He added that “nothing is off the table”, stating: “We have a range of tools at our disposal, and we will not hesitate to act.”

Italy 

• Italian Prime Minister Giorgia Meloni censured the new US tariffs on EU imports and warned that a trade war would “inevitably weaken the West in favour of other global actors”. She added: “We will do everything we can to work for a deal with the United States, aiming to prevent a trade war.” 

Brazil

Colombia

South Korea

• Acting President Han Duck-soo has vowed an “all-out” response and instructed senior officials to urgently address the crisis during an emergency meeting.

• Han also asked the industry minister to analyse the tariff details and negotiate with the US to minimise the impact of reciprocal tariffs.

Taiwan

• Its Cabinet has called the tariffs “very unreasonable” and said it would discuss the matter with the US to ensure its interests are protected.

• The Cabinet also noted that the US calculation of the tariffs was unclear and did not reflect the complementary trade structure between the two sides.

Vietnam 

• Its government is setting up a task force to address the tariffs after an urgent Cabinet meeting on Apr 3.

• The nation’s 2025 growth target of 8 per cent stays intact, noted Vietnamese Prime Minister Pham Minh Chinh.

Malaysia

• It will not pursue retaliatory tariffs, but will continue to seek reciprocal trade gains and maintain strong trade relations with the US, the Malaysian Ministry of Investment, Trade and Industry said.

• Its trade minister will actively engage US authorities to seek a solution. The country will also look to expand its export market to mitigate the impact of tariffs.

What analysts say

Manu Bhaskaran, chief executive officer and founding director at Centennial Asia Advisors 

• Weakening global trade and economic growth could affect Singapore’s trade-oriented economy. Slowing global trade could bring a decline in overall exports and shipments via its ports; and the financial centre’s trade-related financing and hedging activities could suffer.  

• The great uncertainty will be damaging to economies. With uncertainty, businesses will delay hiring and capital spending decisions – which alone will slow global economic growth. Global trade and economic growth will likely weaken if the average tariff rate in the US over time, as things settle and despite negotiations and compromises, remains much higher than during a pre-Trump era.

Selena Ling, chief economist and head of global markets research and strategy at OCBC

• Singapore is unique in that we have a free trade agreement with the US. But the tricky part going forward may be what is mentioned in the latest Office of the United States Trade Representative 2025 trade report pertaining to Singapore – namely regarding our legal and financial services, medical products and pharmaceuticals, as well as intellectual property protection (specifically illegal streaming activities).

Ray Farris, chief economist at Eastspring Investments

• If sustained, the tariffs are likely to push US GDP growth down from 2.5 per cent to about 0.6 to 0.8 per cent this year. The risk of a US recession in the next 12 months is now close to 60 per cent.

• Within Asia, the tariffs will likely weigh most on growth in Vietnam, Korea, Japan and China.

• “We are not optimistic that many countries will reach agreements with the US before the Apr 9 deadline, and we expect the EU, Canada and China to announce retaliatory measures.”

Tai Hui, APAC chief market strategist at JP Morgan Asset Management

• Today’s announcement could potentially raise US average tariff rates to levels not seen since the early 20th century. If these tariffs persist, they could materially impact inflation, as US manufacturing struggles to ramp up capacity and supply chains pass on costs to consumers. For instance, advanced semiconductor manufacturers in Taiwan may not be able to absorb tariff costs without viable substitutes.

• Economies facing smaller tariff increases – such as Australia, the UK, Brazil, and Singapore – may be viewed more favourably.

• Despite the 34 per cent tariff on China, Hong Kong and Chinese markets have shown resilience – partly due to potential stimulus from Beijing – and the announcement could bring more support.

• Onshore artificial intelligence development could also continue to drive corporate earnings. Similarly, European equities might benefit from increased government investment in national defence.

Song Seng Wun, economic advisor, CGS International

• Asia’s headline gross domestic product growth could potentially see one to two percentage points shaved off in 2026 and 2027, especially if countries apply counter tariffs.

• Tariffs on China are unsurprising but what came as a shock was the tariffs on smaller Asean countries such as Cambodia and Vietnam. Asean countries most affected would be those that are unprepared for this – such as Vietnam which previously enjoyed benefits from companies’ redistribution of supply chains away from China.

• For Singapore, the greater impact comes from the indirect side in terms of (whether) other countries and global shipping see pullbacks in demand. Singapore, being an open economy dependent on trade, will be affected. The usual argument is that Singapore’s economy may not be in the direct line of fire but will be indirectly affected by slower demand growth for goods and services – for instance, if Vietnam, Cambodia and Laos were to see a drop in exports.

Chris Kushlis, chief emerging markets macro strategist at T Rowe Price

• The recently announced tariffs represent a significant increase in tariffs on Asian exports, and arguably more than anticipated by the market.

• The United States accounts for about 15 per cent of exports from the region; tariff increases in the range of 20 to 35 per cent would pose a meaningful headwind to growth this year, especially for the more open trade-oriented economies. Furthermore, many Asia economies have a relatively high proportion of their export value added that ends up in the US, so the broad application of tariffs globally will hinder effects to redirect trade.

• Measures such as counter tariffs and currency depreciation could trigger an additional tariff response from the US, resulting in further complication for regional policymakers.

Michael Wan, senior currency analyst at MUFG

• We estimate that US average effective tariff rates are now expected to rise to 23 per cent. This would bring tariff rates above those last seen in the 1930s.

• Much will also depend, among other things, on how and whether other countries retaliate, and also whether there is room for negotiation before the actual implementation of the tariffs. We note that the reciprocal tariffs are slated to take effect only on Apr 9, and so there could be a few days of frenzied deal-making and negotiation in the lead-up to that.

Tommy Xie, head of Asia macro research at OCBC

• If Trump 1.0 targeted China in trade conflicts, Trump 2.0 is casting a wider net – the whole world.

• When the US shifts its focus to the entire world, it may not be inherently negative for China. However, if markets continue to assume that tariffs are merely a bargaining chip for Trump, they may be in for a disappointment. After all, tariffs are a core pillar of his road map to achieving fiscal balance.  In the short run, the world may have to adapt to a new global landscape shaped by pervasive tariffs. Once global trade and supply chains come under widespread pressure, the negative spillovers will inevitably reach China.

Adam Ahmad Samdin, economist at Oxford Economics

• The methodology used by the US for setting tariffs indicates that it is aiming to achieve a bilateral trade balance of zero with various economies – which is why the tariffs on certain countries such as Cambodia and Vietnam are so large and surprising.

• Vietnam has been active in sending officials to negotiate with the US administration, and has offered to import more items. More recently, it said it will cut import duties for the US on a range of goods, including agricultural products, cars, and liquified natural gas.