SINGAPORE GDP GROWTH HITS 3-YEAR HIGH
City-state, however, expects GDP expansion to moderate this year from 3.6pc in 2017
SINGAPORE is expecting a moderation in economic growth this year, pressured by cooling shipments, after a global exports boom helped the city-state clock its fastest expansion in three years last year.
Revised figures released by the Ministry of Trade and Industry (MTI) yesterday showed that gross domestic product (GDP) grew 3.6 per cent last year, the biggest increase since 2014.
The ministry said its central view is for GDP growth this year to come in slightly above the middle of its forecast range of 1.5 to 3.5 per cent.
“The pace of growth in the Singapore economy is expected to moderate this year compared with last year, but remains firm,” said MTI permanent secretary Loh Khum Yean.
The external demand outlook is expected to be slightly weaker this year compared with last year, said the MTI, adding that there were also potential risks arising from United States trade protectionism, as well as any faster than expected normalisation in US monetary policy.
Revised figures showed GDP increased 2.1 per cent on an annualised basis in the October-December quarter from the previous quarter, down from the initial estimate of 2.8 per cent.
The pressure on the economy stemmed from the manufacturing sector, which contracted 14.8 per cent in the fourth quarter on a quarter-on-quarter annualised basis.
“Last year was boosted by electronics growth and that can’t last forever,” said UOB economist Francis Tan.
“However, we see a spillover to the services sector which is usually not too volatile in terms of growth rates,” Tan added.
On a year-on-year basis GDP rose 3.6 per cent in the fourth quarter, better than the advance estimate of 3.1 per cent expansion, but slowing from 5.5 per cent growth in the third quarter. The median forecast picked 2.0 per cent quarter-on-quarter growth and 2.9 per cent year-onyear expansion.
Singapore’s gross domestic product growth of 3.6 per cent last year is the biggest increase since 2014.