Singapore’s economic system grew greater than anticipated final 12 months however a lot slower than in 2021, official knowledge confirmed Tuesday, as analysts warned of weaker progress forward owing to an anticipated recession in key markets.
While the three.8% on-year growth was welcome, it was weighed by a 3.0% contraction in the important thing manufacturing sector within the closing three months.
Growth within the fourth quarter got here in at 2.2%, sharply down from 4.2% in July-September, in keeping with advance estimates by the Trade Ministry.
Exports for pc chips and different merchandise have been hit by softer world demand brought on by surging inflation and sharp will increase in rates of interest.
The city-state’s financial efficiency is commonly seen as a helpful barometer of the worldwide atmosphere due to its reliance on commerce with the remainder of the world.
Last 12 months’s progress beat the three.5% anticipated by the federal government however was half the 7.6% rise loved in 2021.
“While the slight outperformance suggests some resilience in economic activities for now, the overall trend remains on the downside,” Yeap Jun Rong, market analyst at on-line buying and selling agency IG, stated in a observe.
Research home Capital Economics stated it expects exports to fall additional on expectations the worldwide economic system would enter a recession this 12 months.
“Elevated interest rates, declining household savings and high inflation are likely to drag on domestic demand,” it added.
Song Seng Wun, a regional economist with CIMB Private Banking, informed Agence France-Presse (AFP): “The Singapore economy, though faced headwinds, did well enough. But the outlook is cautious given that we are such a trade-dependent economy.”
Prime Minister Lee Hsien Loong warned in his New Year’s message that progress this 12 months is anticipated to ease to 0.5%-2.5%.
“The international outlook remains troubled. The Russia-Ukraine conflict continues, with no good outcome in sight,” he stated.
“U.S.-China tensions are likely to persist. How quickly China recovers from COVID-19 remains to be seen, while the U.S. and EU may well enter a recession. Our economy will be affected.”
