SINGAPORE is in active discussions with the United States over sweeping new drug tariffs, with officials pressing for exemptions that could safeguard one of the city-state’s most valuable export sectors, Deputy Prime Minister Gan Kim Yong said on Saturday.
Gan, who also serves as Singapore’s trade minister, said pharmaceutical companies are seeking clarification on whether they might be spared from the 100% import duties recently announced by U.S. President Donald Trump on branded drugs, unless firms establish manufacturing operations within the United States.
Pharmaceutical products account for around 13% of Singapore’s total exports to the U.S., amounting to approximately S$4 billion (US$3.1 billion), according to Gan. Most of these exports are branded drugs, and the newly announced tariffs have raised significant concerns for both multinational drugmakers based in Singapore and government officials alike.
“Many of the pharmaceutical firms in Singapore have existing plans to expand or build their business footprint in the U.S., which may qualify them for a tariff exemption,” said Gan.
Singapore has had a free trade agreement with the United States since 2004. Nonetheless, the effective tariff rate on Singaporean exports has risen to 7.8% as of July this year, up from 6.8% in April, largely due to recent hikes in steel and aluminium tariffs.
Trump’s new tariff directive, issued on Thursday, would mark a sharp escalation in protectionist trade policy, and risks disrupting a key segment of U.S.–Singapore trade. In July, Singapore’s central bank warned that broader sectoral tariffs could threaten demand for goods including pharmaceuticals, consumer electronics and semiconductors—together accounting for roughly 40% of Singapore’s total exports to the U.S.
Gan said he met U.S. Commerce Secretary Howard Lutnick in August, and that both sides are engaged in detailed trade discussions focused on the pharmaceutical and semiconductor sectors.
“Ultimately, we hope to be able to have an arrangement with the U.S. to allow us to continue to be competitive in the U.S. market, to allow our pharmaceutical companies to be able to continue to export to the U.S. market,” he said.
“As to whether the tariff rate will be 15% or any other tariff is something that is part and parcel of the negotiation, but we do look forward to having some preferential treatment versus the current top-line tariff the U.S. has imposed.” - September 27, 2025
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