US hits Singapore with 12.5% tariffs, citing failure to ban imports produced with forced labour

The Ministry of Trade and Industry previously said that about one-third of Singapore's domestic exports to the US could be affected by the tariffs.

SINGAPORE: The United States will impose a 12.5 per cent tariff on select Singapore goods from Friday (Jul 24), after concluding that the country does not have sufficient measures to block imports produced wholly or in part with forced labour.

The move follows a US Section 301 investigation into 60 trading partners over their alleged failure to enforce bans on imports of goods produced with forced labour.

The US Trade Representative concluded in June that 54 of these economies, including Singapore, China and Britain, "failed to impose and effectively enforce a forced labour import prohibition", and proposed a 12.5 per cent tariff on certain goods.

A lower 10 per cent tariff was suggested for the remaining economies that were under probe as they have laws explicitly banning imports made with forced labour.

Singapore’s Ministry of Trade and Industry had earlier said that about one-third of the country’s domestic exports to the US could be affected by the tariffs. CNA has contacted the ministry for comment on the latest announcement.

Singapore has engaged with the US since the investigation was launched, maintaining that it does not condone forced labour and has a comprehensive framework to tackle such practices domestically.

Foreign Affairs Minister Vivian Balakrishnan said on Thursday that Singapore had told the US it has "no technical or economic basis" for imposing tariffs on it.

"I made a point quite categorically that the US has a surplus, a trade surplus against us. In fact, it is growing," Dr Balakrishnan said after meeting US Secretary of State Marco Rubio on the sidelines of the 59th Association of Southeast Asian Nations (ASEAN) Foreign Ministers' Meeting.

"Nevertheless, you know as well as I do that the American administration, for its own domestic political reasons, needs to raise tariff revenue," he said.

Speaking on America’s trade surplus with Singapore, the minister said he was trying to find a way to show the US that his country is not their target.

“But we also need to make sure we don't become collateral damage in the overall scheme in which tariffs are going to be raised by the US with all its trading partners," he added.

The new tariffs will take effect on Friday, the same day a separate round of global duties introduced earlier this year by US President Donald Trump is set to expire. Officials said the latest measures are designed to be more resilient to legal challenges.

Goods already subject to sector-specific tariffs – such as steel and aluminium – will not be affected.

Goods entering under the US-Mexico-Canada free trade pact will also be exempt, a US official told reporters.