Two-thirds of Singapore businesses surveyed by the Singapore Business Federation (SBF) say they have been “moderately to severely” affected by the ongoing Iran war, as global geopolitical tensions continue to drive up energy prices, disrupt logistics, and weaken customer demand. The findings point to widespread cost pressures across the economy, with smaller firms bearing a disproportionately heavier burden.
According to the poll of 254 companies, 66 per cent reported being impacted by rising energy costs, while 54 per cent cited higher shipping and freight expenses. Nearly half of respondents, 48 per cent, also said they were experiencing reduced or weakened customer demand as a result of the broader economic disruption linked to the conflict and its ripple effects on global markets.
The survey highlights a clear divide in resilience between company sizes. While around half of large firms reported moderate impacts, small and medium-sized enterprises (SMEs) are facing more severe strain, with one in three describing significant to severe disruptions. Larger firms also reported greater exposure to insurance and security-related costs, reflecting broader operational complexity and risk coverage needs. In contrast, SMEs appear more vulnerable to immediate cost shocks and less equipped to absorb volatility.
Confidence levels also diverge sharply. Just over a third of SMEs said they feel confident managing ongoing economic volatility, compared with 78 per cent of large companies. More than half of all respondents also expressed strong concern about their long-term viability if macroeconomic conditions fail to improve within the next six months, underscoring growing anxiety over sustained geopolitical uncertainty.
Despite these pressures, businesses are actively adjusting strategies to cope with rising costs. About half of all firms reported increasing prices or renegotiating contracts to protect margins, while 40 per cent of SMEs are focusing on conserving cash to maintain financial stability. Larger firms, meanwhile, are deploying more advanced risk management tools, with about a third engaging in fuel and foreign exchange hedging and 17 per cent investing in energy efficiency measures.
Even so, companies across the board are calling for additional targeted support to manage what many view as persistent cost pressures. More than two in five businesses are seeking working capital assistance, while over a third are requesting help with logistics cost management, reflecting concerns that current conditions may extend beyond short-term disruption.
The survey comes as Singapore’s government has already introduced several support measures, including an increase in corporate income tax rebates and expanded energy efficiency grants. Many firms described these measures as helpful in easing immediate pressures, though businesses continue to signal that longer-term geopolitical instability requires further policy responses to safeguard competitiveness and economic resilience.
