Companies brace for higher costs, supply chain disruptions from new US tariffs

Nearly 7 in 10 (69%) anticipate a negative impact on their company.

Most Singapore companies believe that the US tariffs will have a negative impact on their operations, according to a poll.

In a flash survey of 36 Singapore companies, 80% of respondents indicated that the new US tariffs will impact them, and the remaining said it will have no impact, the American Chamber of Commerce in Singapore (AmCham Singapore) found.

Twenty-five (25) respondents or 69% of respondents anticipate a moderate negative to significantly negative impact on their company. Seven (7) expects no impact, whilst the remaining four (4) even anticipate a positive impact on their company.

At least two-thirds or 23 respondents cited increased costs; 20 respondents anticipate supply chain disruptions; and 19 respondents believe that it will increase regulatory complexity.

“Reciprocal tariffs present greater concerns than existing measures,” AmCham Singapore write in the report.

“Companies expressed that potential reciprocal tariffs on countries taxing US imports would have the most significant impact on their business, overshadowing concerns about existing steel and aluminum tariffs, which affect only about one-quarter of respondents,” it added.

Only one company saw tariffs as a “potential catalyst for incentivizing domestic manufacturing,” which AmCham Singapore said highlights how the burdens outweigh the benefits.

Nearly half (45%) of respondents plan to pass at least some of the tariff costs to their customers in the US.

Passing on costs to consumers was the top strategy of businesses to address the tariffs, with 16 companies indicating this.

Meanwhile, 13 companies said that they plan to diversify supply chains to other regions, and 11 plan to “strategically position to increase in market share.”

Over 83% of businesses said that the tariffs would be harmful to the business environment— 12 with a “significant negative impact,” and 18 saying it will have a “moderate negative impact.”

Over 91% or 33 respondents believe that the tariffs will harm the US economy, more than the 67% who believe it will harm the Singapore economy.