Traders work after the opening bell at the New York Stock Exchange (NYSE) on August 5, 2019 at Wall Street in New York City. - Selling on Wall Street accelerated early Monday as a steep drop in the Chinese yuan escalated the US-China trade war following President Trump's announcement of new tariffs last week. (Photo by Johannes EISELE / AFP)        (Photo credit should read JOHANNES EISELE/AFP/Getty Images)
PHOTO: Johannes Eisele/AFP/Getty Images
Traders work after the opening bell at the New York Stock Exchange (NYSE) on August 5, 2019 at Wall Street in New York City. - Selling on Wall Street accelerated early Monday as a steep drop in the Chinese yuan escalated the US-China trade war following President Trump's announcement of new tariffs last week. (Photo by Johannes EISELE / AFP) (Photo credit should read JOHANNES EISELE/AFP/Getty Images)
Now playing
01:23
Investors seek safe haven from trade war fears
Now playing
01:23
'There should be no threats': Biden's message to union-busters
PHOTO: CNN
Now playing
02:54
'Biggest trial of my life': Landlord says eviction moratorium has drained her savings
An activist wears a "Fight For $15" T-shirt during a news conference prior to a vote on the Raise the Wage Act July 18, 2019 at the U.S. Capitol in Washington, DC. The legislation would raise the federal minimum wage from $7.25 to $15 by 2025.  (Photo by Alex Wong/Getty Images)
PHOTO: Alex Wong/Getty Images
An activist wears a "Fight For $15" T-shirt during a news conference prior to a vote on the Raise the Wage Act July 18, 2019 at the U.S. Capitol in Washington, DC. The legislation would raise the federal minimum wage from $7.25 to $15 by 2025. (Photo by Alex Wong/Getty Images)
Now playing
02:59
How to make sense of the minimum wage debate
Now playing
02:53
A living wage made a world of difference to him
People walk by a closed restaurant in Rockefeller Center on the last Sunday before Christmas on December 20, 2020 in New York City. Rockefeller Center, where the annual Christmas tree is displayed among other holiday attractions, has far less crowds this year and numerous restrictions due to the ongoing COVID-19 pandemic. New York City has seen a slow uptick in COVID hospitalizations over the last few weeks but is still far below the numbers witnessed in the spring. (Photo by Spencer Platt/Getty Images)
PHOTO: Spencer Platt/Getty Images
People walk by a closed restaurant in Rockefeller Center on the last Sunday before Christmas on December 20, 2020 in New York City. Rockefeller Center, where the annual Christmas tree is displayed among other holiday attractions, has far less crowds this year and numerous restrictions due to the ongoing COVID-19 pandemic. New York City has seen a slow uptick in COVID hospitalizations over the last few weeks but is still far below the numbers witnessed in the spring. (Photo by Spencer Platt/Getty Images)
Now playing
02:19
Pain in the US job market: Another 730,000 filed first-time claims
WASHINGTON, DC - FEBRUARY 01: U.S. President Joe Biden (Center R) and Vice President Kamala Harris (Center L) meet with 10 Republican senators, including Mitt Romney (R-UT), Bill Cassidy (R-LA) and Susan Collins (R-ME), in the Oval Office at the White House February 01, 2021 in Washington, DC. The senators requested a meeting with Biden to propose a scaled-back $618 billion stimulus plan in response to the $1.9 trillion coronavirus relief package Biden is currently pushing in Congress. (Photo by Doug Mills-Pool/Getty Images)
PHOTO: Pool/Getty Images North America/Getty Images
WASHINGTON, DC - FEBRUARY 01: U.S. President Joe Biden (Center R) and Vice President Kamala Harris (Center L) meet with 10 Republican senators, including Mitt Romney (R-UT), Bill Cassidy (R-LA) and Susan Collins (R-ME), in the Oval Office at the White House February 01, 2021 in Washington, DC. The senators requested a meeting with Biden to propose a scaled-back $618 billion stimulus plan in response to the $1.9 trillion coronavirus relief package Biden is currently pushing in Congress. (Photo by Doug Mills-Pool/Getty Images)
Now playing
02:08
Zandi: Stimulus plan doesn't do enough for the most in need
Now playing
01:57
Fed chief downplays inflation concerns
Paul Krugman Amanpour Democratic Primary Economy_00012322.jpg
Paul Krugman Amanpour Democratic Primary Economy_00012322.jpg
Now playing
03:19
Economist: Biden's $1.9 trillion stimulus plan is not too large
Now playing
03:19
Christine Lagarde: Global stimulus is needed now
Now playing
02:42
A challenging year for women: Millions are out of work
People walk by a closed restaurant in Rockefeller Center on the last Sunday before Christmas on December 20, 2020 in New York City. Rockefeller Center, where the annual Christmas tree is displayed among other holiday attractions, has far less crowds this year and numerous restrictions due to the ongoing COVID-19 pandemic. New York City has seen a slow uptick in COVID hospitalizations over the last few weeks but is still far below the numbers witnessed in the spring. (Photo by Spencer Platt/Getty Images)
PHOTO: Spencer Platt/Getty Images
People walk by a closed restaurant in Rockefeller Center on the last Sunday before Christmas on December 20, 2020 in New York City. Rockefeller Center, where the annual Christmas tree is displayed among other holiday attractions, has far less crowds this year and numerous restrictions due to the ongoing COVID-19 pandemic. New York City has seen a slow uptick in COVID hospitalizations over the last few weeks but is still far below the numbers witnessed in the spring. (Photo by Spencer Platt/Getty Images)
Now playing
03:12
These owners had to close their iconic restaurants during the pandemic
Now playing
04:52
ICC warns vaccine nationalism will damage global economy
Now playing
04:04
San Francisco Fed chief: Inequality is bad for the economy
PHOTO: CNN
Now playing
01:47
Yellen: No reason we should suffer through a long, slow recovery
PHOTO: CBS Evening News with Norah O'Donnell
Now playing
03:29
Biden doesn't believe minimum wage hike will survive relief bill
(CNN Business) —  

Singapore could be heading for a recession after it reported a big drop in economic activity in the second quarter of the year.

The wealthy city state is being hurt by the US-China trade war and is heading for its weakest annual growth since 2009, when the economy shrunk by 0.6% during the global financial crisis.

Singapore on Tuesday slashed its forecast for GDP growth in 2019 to between 0% and 1%. Previously, it predicted the economy to grow by between 1.5% and 2.5%.

The downgrade followed very weak figures for the April-June period, when GDP shrank by 3.3% compared to the first quarter of the year.

The outlook has weakened in part because of how much trade tensions between the United States and China have escalated, Singapore’s Ministry of Trade and Industry said on Tuesday.

Singapore is heavily reliant on exports and China is its biggest trading partner. The Chinese economy is growing at its slowest pace in 27 years.

The Ministry of Trade and Industry said it expected that Singapore will “likely to continue to face strong headwinds for the rest of the year.”

“With trade tensions between the US-China unlikely to abate anytime soon, we expect exports and trade-related services to push the economy into technical recession in Q3,” Sian Fenner at Oxford Economics wrote in a research note.