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June 4, 2026

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CNA Explains: What the US forced labour probe means for global trading partners

Dozens of economies, including Singapore, could face a new 12.5 per cent levy if the proposed tariffs are implemented.

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SINGAPORE: The United States is mulling new tariffs of between 10 per cent and 12.5 per cent on dozens of economies, including Singapore, following a probe into forced labour practices.

Analysts said the move is part of Washington’s effort to rebuild broad tariffs after earlier measures were struck down in court.

Washington on Tuesday (Jun 2) released results from investigations into 60 trading partners – among them China, Australia, the European Union, Japan, South Korea, Singapore and the Philippines – examining whether they act against imports of goods made with forced labour, and whether any shortcomings harm US commerce.

All 60 economies could face fresh tariffs, the US Trade Representative (USTR) said. Singapore, for instance, may be hit with a 12.5 per cent levy.

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How did the US arrive at these findings, and what do they signal about its broader trade strategy? Here’s what you need to know.

What were the investigation results?

The USTR concluded that only six economies – Canada, Ecuador, the European Union, Indonesia, Mexico and Pakistan – have laws explicitly banning imports made with forced labour.

The remaining 54 “failed to impose and effectively enforce” such prohibitions.

The benchmark used was whether these economies have clear legal bans on forced labour imports and whether those bans are effectively enforced, said Ms Heather Hurlburt, an associate fellow at Chatham House and former USTR chief of staff.

“It’s worth noting that many countries have laws requiring disclosure of the use of forced labour in imported goods, or voluntary standards urging that goods made with forced labour be avoided,” she told CNA.

“The Trump administration said those are not good enough.”

Based on these findings, the USTR has proposed tariffs ranging from 10 per cent to 12.5 per cent.

Why is the US doing this?

The timing is closely tied to looming legal and policy deadlines.

Temporary 10 per cent tariffs imposed after the US Supreme Court struck down earlier “reciprocal” tariffs are set to expire on Jul 24.

“(The) USTR is accepting written comments and hearings surrounding their determinations until early July, which are likely to conclude just before the expiration date of the earlier, temporary tariffs,” said Mr Kevin Chen, an associate research fellow at the S Rajaratnam School of International Studies.

The forced labour probe, along with other ongoing investigations, is aimed at re-establishing broad US tariffs on a stronger legal footing, said Ms Hurlburt.

This is something Trump has said “explicitly”, she added.

“There is little doubt” that the move is part of a wider tariff strategy, said Mr Chen, pointing to comments by US Treasury Secretary Scott Bessent after the Supreme Court struck down the “Liberation Day” tariffs.

“Bessent noted how the Section 301 tariffs and other statutes would be used to ‘get us back to the same tariff level’,” said Mr Chen.

“In fact, while we are still waiting for the results of the excess capacity investigation, Vietnam was recently announced as the subject of a fresh Section 301 investigation into intellectual property rights,” he said.

“We can expect more of such investigations … to emerge over the coming months.”

Ms Hurlburt agreed, noting that US Trade Representative Jamieson Greer has said that “the president’s trade policy remains the same”.

Ms Deborah Elms, head of trade policy at the Hinrich Foundation, shared similar sentiments.

“I think that this is less of a serious investigation and much more of a way for the US to rebuild its tariff wall that was reduced when the Supreme Court overturned Trump’s first attempt at building new tariffs,” she said.

Cargo shipping containers are seen adjacent to storage tanks at Marathon Petroleum’s Los Angeles Refinery. (File photo: Reuters)

Why is the US focusing on forced labour?

The International Labour Organization (ILO) defines forced labour as work carried out under threat of penalty and without voluntary consent.

According to the USTR, economies that fail to block such imports create unfair competition by allowing artificially cheap goods into global markets, burdening US businesses.

The 60 economies investigated account for 99.4 per cent of US imports.

“Although it is universally recognised that forced labour is a practice that should not be tolerated, the use of forced labour across the world continues to persist and has even increased in recent years,” the USTR said.

However, Ms Elms said that the US approach lacks clarity.

“All of the materials that I’ve read from the case that was released today don’t really clarify very much what the US is looking for and what it would mean to effectively enforce that,” she told CNA’s Asia First.

How were the tariff rates derived?

The US is proposing a 10 per cent tariff for a group of economies – including Canada, the EU, Britain, Indonesia, Malaysia, Taiwan and Mexico – that have some form of forced labour prohibition in law or in trade agreements with Washington.

All others, including Singapore, China and Japan, could face a higher rate of 12.5 per cent.

It is unclear how these figures were determined.

However, the 10 per cent rate mirrors the most favourable tariff level previously offered by the Trump administration to any trading partner, Ms Hurlburt noted.

She also pointed out that many goods are exempted – unlike earlier tariff rounds – including items such as beef, coffee and certain fruits and nuts.

This reflects concerns about inflation and avoiding disruptions to US industrial production, she added.

What effects could the tariffs have on Singapore?

Singapore has refuted the US’ claims, but a potential 12.5 per cent tariff could still have economic consequences.

The proposed tariff covers approximately one-third of Singapore’s domestic exports to the US due to various product exemptions, Singapore’s Ministry of Trade and Industry (MTI) said on Thursday.

The new levies “could erode its competitive advantage and lead to shifts in supply chains”, said Ms Elms.

She noted that Singapore is also facing a separate US probe into alleged structural excess capacity in manufacturing sectors, compounding the risk.

For businesses, the key question will be whether exports to the US remain viable.

“I think firms have to do that internal calculation themselves. What is that sort of magic number … beyond which you can no longer afford to absorb a tariff, and then that’s when you really need to get serious about diversification outside of the United States,” Ms Elms said.

MTI reiterated that Singapore does not condone the use of forced labour in supply chains, adding that forced labour is a transnational issue that requires international cooperation.

“MTI will continue to engage the USTR constructively to explore options on this matter, and is assessing the impact of the proposed actions on Singapore’s exports to the US,” it said.

What is the risk of the new tariffs being struck down?

While legal challenges are likely, the new tariffs may be harder to strike down as they are based on Section 301 of the Trade Act of 1974, which allows the USTR to impose tariffs to counter unfair trade practices.

“This gives the Section 301 tariffs much more legal certainty as … the act explicitly authorises USTR to impose tariffs to remedy a foreign trade practice,” Mr Chen said.

“In addition, any rates that are imposed can be modified and adjusted by the executive branch at will.”

The administration “is on much stronger legal footing here than with its 2025 tariffs”, said Ms Hurlburt.

However, she noted that the findings are broad and do not document specific harms to US industries, which is typically required.

She also highlighted that Section 301 has not previously been used in this way, and that the US argument relies heavily on ILO conventions that it does not fully adopt.

“So there will likely be legal challenges to these tariffs, but the outcome at the Supreme Court is unclear,” she said.

Want an issue or topic explained? Email us at digitalnews [at] mediacorp.com.sg. Your question might become a story on our site.

Source: CNA/nh/rl(gs)

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