The trouble with tariffs: Singapore needs diversified economy to escape US-China trade tensions

World
Europe

04:06

Editor’s note: The article is based on an interview with Zhang Jianping, director general of the Chinese Academy of International Trade and Economic Cooperation. The article reflects the expert’s opinion, and not necessarily the views of CGTN.

China-US trade tensions continue to escalate as China decided to slap additional tariffs of 25 percent on 16 billion dollars' worth of US products. This is in retaliation against Trump administration's plans to begin collecting 25 percent tariffs on an additional 16 billion dollars' worth of Chinese goods from August 23.

The trade conflict between the US and China has caused some worries in Singapore.

During the interview, Zhang Jianping, director general of the Chinese Academy of International Trade and Economic Cooperation, said as a free economy, Singapore is not able to fully escape from a global trade war caused by the Trump administration. He also said trade war will lead to global trade decline and will hurt Singapore’s economy.

Singapore is a trade-dependent and export-heavy economy. It also plays a very important role in the maritime transportation system in the global market as well as in international trade.

Zhang said Singapore, as a small economy, has their concerns over economic stability. In the past decades, the city-state has already made its economy more diversified.

Zhang Jianping observes Singapore needs to keep its industries and markets diversified to mitigate loses in the trade war. He also said another useful approach would be regional economic cooperation, especially regional economic integration, adding the economic crisis will make Singapore and other countries think that “We have to work together in order to improve efficiency and cover cost.”