An In-Depth Analysis
Executive Summary
Chinese President Xi Jinping’s meeting with Uruguayan President Yamandu Orsi on February 3, 2026, represents far more than a bilateral diplomatic engagement. Against the backdrop of the controversial U.S. military intervention in Venezuela just one month prior, Xi’s call for an “equal and orderly multipolar world” signals Beijing’s intensified campaign to reshape global order—a development with profound implications for Singapore’s strategic positioning, economic interests, and foreign policy calibration.
For Singapore, a city-state with a trade-to-GDP ratio exceeding 300 percent and deep entanglements with both the United States and China, navigating this emerging multipolar landscape has become the defining challenge of the 2020s. This analysis examines the multifaceted impacts of China’s multipolar agenda on Singapore across five critical dimensions: economic ties, geopolitical positioning, ASEAN dynamics, security considerations, and strategic autonomy.
The Venezuela Context: A Watershed Moment
The timing of Xi’s meeting with Orsi carries particular significance. This was the first visit by a South American leader to Beijing following the January 3, 2026 U.S. military operation in Venezuela—code-named “Operation Absolute Resolve”—which resulted in the capture of President Nicolás Maduro and his forced transfer to New York for trial on narcoterrorism charges.
China condemned the operation as a violation of Venezuelan sovereignty and international law, calling for Maduro’s immediate release. The incident has galvanized Beijing’s messaging around multipolar world order, with Chinese officials positioning the country as a defender of sovereignty principles and international law—a stark contrast to what they characterize as U.S. unilateralism.
For Singapore, this presents a delicate balancing act. While the city-state maintains close defense ties with Washington, it also adheres firmly to principles of sovereignty and non-interference that align more closely with China’s stated position on Venezuela. Singapore did not publicly endorse the U.S. operation, reflecting its careful neutrality on contentious great power issues.
Economic Dimensions: The China Dependency Challenge
Trade and Investment Ties
China has been Singapore’s largest trading partner in goods for 12 consecutive years. In 2023, Singapore’s exports to China reached approximately $65.59 billion, while Singapore remains the largest source of foreign direct investment into China among all countries.
During Prime Minister Lawrence Wong’s June 2025 visit to Beijing—his first state visit to China—both nations signed $8.2 billion worth of new agreements spanning digital economy, green finance, artificial intelligence, and Belt and Road Initiative projects. This visit, occurring amid U.S. tariff tensions, underscored Singapore’s commitment to deepening economic engagement with China even as Washington imposed a 10 percent tariff on Singaporean goods.
The upgraded China-Singapore Free Trade Agreement facilitates greater collaboration in services, investment, and the digital economy—sectors critical to Singapore’s economic future. As China positions itself as a champion of free trade and multilateralism in response to U.S. protectionism, Singapore finds itself economically aligned with Beijing’s vision, even as it maintains security partnerships with Washington.
Strategic Economic Projects
Singapore and China collaborate on three major government-to-government projects in Chinese cities, aligned with China’s reform priorities: the Suzhou Industrial Park, the Tianjin Eco-City, and the Chongqing Connectivity Initiative. The latter has proven particularly significant, creating the New International Land-Sea Trade Corridor—a multimodal transportation network that has reduced transit times compared to eastern coastal routes and generated substantial commercial activity.
These projects represent more than economic cooperation; they are strategic anchors that give Singapore privileged access to China’s vast domestic market and position the city-state as a bridge between China and Southeast Asia. In China’s vision of a multipolar world where regional economic integration matters more than Western-dominated global institutions, Singapore’s role as a connector economy becomes even more valuable.
The Tariff Dilemma
The Trump administration’s decision to impose a 10 percent tariff on Singapore despite the city-state’s trade deficit with the United States in both goods and services represents a significant economic challenge. Prime Minister Wong expressed disappointment, noting these were “not actions one does to a friend.”
This U.S. action inadvertently strengthens China’s narrative of being a more reliable and predictable economic partner. As Beijing positions itself as a defender of the rules-based multilateral trading system—ironically, given its own selective adherence to international norms—Singapore and other ASEAN nations may find Chinese-led regional economic frameworks increasingly attractive alternatives to U.S.-dominated global institutions.
Geopolitical Positioning: Walking the Tightrope
The Intensifying U.S.-China Rivalry
Singapore’s Ministry of Foreign Affairs acknowledged in September 2025 that the nation’s foreign policy must “adapt swiftly” to realities including “sharper major power rivalry.” This represents a significant shift in tone for a government that traditionally avoids drawing attention to great power tensions.
The city-state finds itself in an increasingly uncomfortable position. The United States remains the largest source of foreign direct investment in Singapore, while Singapore is among the top sources of FDI in China. Singapore maintains close defense cooperation with Washington, including hosting U.S. military facilities and purchasing American F-35 fighter jets. Yet China is Singapore’s largest trading partner and a critical economic partner.
China’s push for a multipolar world directly challenges the U.S.-led unipolar order that has underwritten Singapore’s prosperity and security since independence. As Xi calls for “an equal and orderly multipolar world,” Singapore must navigate between two competing visions of international order—neither of which may adequately serve its interests.
The Taiwan Dimension
Singapore maintains unofficial ties with Taiwan, including a military training agreement dating to 1975 under which Singaporean forces conduct annual exercises (Operation Starlight) in Taiwan. This arrangement has occasionally strained relations with Beijing, most notably in 2016 when Hong Kong authorities seized nine Singapore Army armored vehicles returning from Taiwan.
As tensions over Taiwan intensify, Singapore’s position becomes more precarious. The city-state cannot abandon its Taiwan training facilities—which are essential given Singapore’s limited land area—but must carefully manage this relationship to avoid provoking Beijing. A Chinese military conflict over Taiwan would be catastrophic for Singapore, potentially forcing it to choose between its economic interests and security partnerships.
Cybersecurity Tensions
In July 2025, Singapore’s Coordinating Minister for National Security K. Shanmugam revealed that the country’s critical infrastructure was attacked by UNC3886, a cyber-espionage group previously linked to the Chinese government. This incident underscores the security challenges Singapore faces even as it deepens economic ties with China. The city-state must invest heavily in cybersecurity and digital sovereignty while maintaining diplomatic equanimity.
ASEAN Dynamics: Centrality Under Pressure
ASEAN’s Strategic Multi-Alignment
Singapore has long championed ASEAN centrality as a cornerstone of regional order. However, China’s multipolar vision and its deepening bilateral engagements with individual ASEAN members threaten to undermine ASEAN’s collective bargaining power.
China signed an upgraded ASEAN-China Free Trade Agreement 3.0 in 2025, expanding cooperation on infrastructure, digital transition, and sustainability. While this benefits ASEAN economies, it also increases their individual dependencies on China, potentially fragmenting ASEAN unity. China’s diplomatic tour through Malaysia, Cambodia, and Vietnam in April 2025 demonstrated how Beijing exploits ASEAN divisions to advance its interests.
For Singapore, ASEAN centrality serves as a force multiplier, allowing the city-state to punch above its weight through collective action. As ASEAN’s unity frays under great power pressure, Singapore’s strategic influence diminishes. The city-state must work harder to maintain ASEAN cohesion while simultaneously pursuing its own bilateral interests with major powers.
Singapore’s 2027 ASEAN Chairmanship
Singapore will assume the ASEAN chairmanship in 2027, providing an opportunity to shape the regional agenda amid mounting geopolitical pressures. The chairmanship comes at a critical juncture, with ASEAN facing internal divisions (exemplified by the Cambodia-Thailand conflict) and external pressures from both China and the United States. Singapore’s ability to champion deeper economic integration, advance the ASEAN Connectivity Strategic Plan 2026-2035, and maintain the bloc’s relevance in a multipolar world will be tested.
The Connector Economy Role
In a multipolar world, ASEAN’s—and Singapore’s—value proposition shifts from alignment to connectivity. Singapore has positioned itself as the definitive connector economy, linking global trade flows of goods, services, investment, data, and talent. This role becomes more critical as geopolitical fragmentation intensifies. Singapore’s advanced financial infrastructure, rule of law, and strategic location make it indispensable to both Western and Chinese firms seeking to navigate an increasingly complex regional landscape.
Security Considerations: Military Modernization and Strategic Hedging
Defense Spending and Capabilities
Singapore allocated S$23.4 billion ($18.1 billion) for defense in fiscal year 2025/26, a 12.4 percent increase over the previous year. This substantial investment reflects Singapore’s determination to maintain the most advanced armed forces in Southeast Asia amid intensifying regional tensions.
The Singapore Armed Forces are acquiring F-35B and F-35A stealth fighters, making Singapore the only country in Southeast Asia to operate fifth-generation aircraft. The military is also procuring new Titan infantry fighting vehicles and upgrading its High Mobility Artillery Rocket System. These capabilities are designed to deter aggression and maintain Singapore’s strategic relevance in a multipolar Asia where military power matters.
Strategic Partnerships
While deepening economic ties with China, Singapore is simultaneously strengthening defense partnerships with the United States, Australia, New Zealand, France, Germany, and the United Kingdom. This diversification strategy reflects Singapore’s understanding that in a multipolar world, no single power can guarantee its security. The city-state must maintain robust defense relationships with multiple partners while avoiding exclusive alignment with any single bloc.
Strategic Autonomy: Singapore’s Path Forward
Pragmatic Multi-Alignment
Singapore has articulated a clear position: it will not choose between the United States and China but will seek to consolidate relations with both. This approach, sometimes called strategic multi-alignment or hedging, requires exceptional diplomatic skill and economic strength.
The Future of Investment and Trade Partnership, launched in September 2025 with 14 small and medium-sized countries across six continents, exemplifies this strategy. Singapore is working with like-minded partners to strengthen multilateralism and the international rules-based order—providing an alternative to both U.S.-dominated institutions and Chinese-led frameworks.
Economic Resilience and Diversification
Singapore’s extreme dependence on global trade (over 300 percent of GDP) makes economic diversification essential. The city-state cannot afford to become overly dependent on any single market or supply chain. This drives Singapore’s push for multiple free trade agreements, participation in both the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and cultivation of economic relationships across Asia, Europe, and the Americas.
As China promotes its vision of an “inclusive, universally beneficial economic globalisation,” Singapore must ensure this translates into genuine openness rather than a China-centric regional order. The city-state’s economic model depends on global connectivity, not regional exclusivity.
Institutional Innovation
Singapore is pioneering practical solutions to navigate multipolar tensions. The development of regional payment connectivity systems (PayNow linkages with Thailand’s PromptPay, Indonesia’s QRIS, and Vietnam’s VietQR) reduces dollar dependence without confronting U.S. financial dominance directly. These initiatives demonstrate functional multipolarity in action—building parallel infrastructure that serves regional needs while maintaining openness to global systems.
Risks and Vulnerabilities
The Choice Scenario
The greatest risk for Singapore is being forced to choose between the United States and China. A Taiwan contingency, severe economic decoupling, or explicit demands for exclusive alignment from either Washington or Beijing would place Singapore in an untenable position. The city-state’s entire foreign policy strategy is predicated on maintaining strategic autonomy—a luxury that may not survive a true crisis.
Economic Fragmentation
Greater protectionism, competing technology standards, and regional economic blocs threaten Singapore’s model as a global trading hub. The U.S.-China technology war has already disrupted semiconductor supply chains. Further fragmentation into a U.S.-led democratic bloc and a China-led authoritarian bloc would severely damage Singapore’s connector economy role. The city-state’s prosperity depends on preventing this worst-case scenario.
Regional Instability
Military conflict in the South China Sea, the Taiwan Strait, or elsewhere in the region would be catastrophic for Singapore. As a major transshipment hub and the second-busiest container port globally, Singapore’s economy would suffer immediate disruption. More fundamentally, regional conflict would collapse the security architecture that has enabled Singapore’s remarkable development since independence.
Opportunities in Multipolarity
Increased Bargaining Power
Paradoxically, a multipolar world may increase Singapore’s strategic leverage. As major powers compete for influence, small states gain negotiating power. Singapore can extract better terms from both China and the United States by playing them against each other—obtaining economic concessions from Beijing and security guarantees from Washington without exclusive commitment to either.
Middle Power Leadership
In a fragmented world, middle powers and small states have greater agency. Singapore can lead coalitions of like-minded countries to shape international norms and institutions. The FIT Partnership demonstrates this potential. As traditional multilateral institutions lose effectiveness, new flexible frameworks led by middle powers may become more influential.
Economic Diversification Dividend
Supply chain diversification driven by geopolitical tensions positions Singapore as a prime beneficiary. As companies seek alternatives to China or the United States, Singapore’s stability, connectivity, and business-friendly environment make it an attractive hub for regional headquarters, manufacturing coordination, and financial services. ASEAN collectively is attracting billions in manufacturing relocations—and Singapore captures a disproportionate share of the high-value service sector.
Conclusion: Navigating Uncertainty with Strategic Clarity
Xi Jinping’s call for an “equal and orderly multipolar world” during his meeting with Uruguay’s president reflects China’s broader campaign to reshape international order. For Singapore, this vision presents both profound challenges and potential opportunities.
The emerging multipolar order is less favorable to Singapore than the U.S.-led unipolar system that prevailed from 1991 to the mid-2010s. Greater protectionism, regional fragmentation, and intensifying great power rivalry all threaten Singapore’s economic model and security environment. The city-state can no longer rely on American hegemony to maintain regional stability and open markets.
Yet Singapore has navigated difficult geopolitical environments before. The city-state’s success has always depended on strategic clarity, pragmatic adaptation, and exceptional execution. The current moment demands no less.
Singapore’s strategy must rest on several pillars: maintaining robust economic ties with China while preserving security partnerships with the United States; championing ASEAN unity and centrality as a force multiplier; investing in military capabilities to ensure strategic relevance; building coalitions with like-minded middle powers; and fostering economic resilience through diversification and innovation.
Most fundamentally, Singapore must preserve its strategic autonomy. In a multipolar world where great powers compete for exclusive alignment, Singapore’s ability to engage with all sides without surrendering its independence becomes the ultimate measure of success.
The Venezuela intervention and Xi’s subsequent emphasis on multipolarity underscore that the international system is in flux. For Singapore, this is not merely an external development to observe but an existential challenge to navigate. The city-state’s prosperity, security, and sovereignty depend on how skillfully it adapts to a world where the rules are being rewritten.
As Prime Minister Wong noted during his June 2025 visit to Beijing, “the China-Singapore relationship is more important than before” in times of global turbulence and uncertainty. The same could be said of Singapore’s relationship with the United States, ASEAN, and the broader international community. Singapore’s success in the multipolar era will be measured not by choosing the right side, but by refusing to choose at all—while remaining indispensable to all sides.