Taiwan becomes Singapore’s largest merchandise trading partner

Taiwan has surpassed China to become Singapore’s largest merchandise trading partner in 2025. Bilateral trade flows have surged past S$170 billion, driven largely by the semiconductor and artificial intelligence sectors.

The relationship is characterized by a highly integrated AI supply chain. Taiwan provides advanced logic chips and foundry dominance, while Singapore serves as a regional hub for precision equipment, advanced materials, assembly, testing, and logistics. This synergy allows both nations to strengthen their respective national AI strategies.

Beyond goods, there is significant capital movement between the two. Singapore has become a primary destination for Taiwanese overseas assets, with 60% to 70% of such assets—totaling approximately S$326 billion—now managed in Singapore due to its political stability and mature banking system. Additionally, Singaporean foreign direct investment into Taiwan saw a notable increase between January and July, representing over 62% of Taiwan’s total foreign investment during that period.