S’PORE Q4 GROWTH SLOWS
1.9pc expansion weakest since third quarter of 2016, with more pain seen
SINGAPORE’S economy grew at its slowest pace in more than two years in the fourth quarter, data showed yesterday, and the citystate’s trade ministry warned that manufacturing is likely to face significant moderation this year.
Weakening growth momentum for Singapore’s open economy — a high-tech manufacturing base and transportation hub — underscores the risks to Asia’s export economies from a slowdown in China and Beijing’s trade war with Washington.
Singapore’s growth pace was expected to slow this year as manufacturing “is likely to see a significant moderation”, said trade ministry official Loh Khum Yean, adding that the important electronics and semiconductor sector was particularly vulnerable.
He said services, which accounted for roughly 70 per cent of the economy, were also likely to ease.
From a year earlier, gross domestic product (GDP) grew 1.9 per cent in the fourth quarter, less than the 2.2 per cent advance estimate from the Ministry of Trade and Industry and the 2.1 per cent rise seen in the poll.
That was the slowest on-year pace since the third quarter of 2016, when it grew 1.2 per cent.
In October-December, the economy grew 1.4 per cent from the previous three months on an annualised and seasonally adjusted basis, lower than the ministry’s initial estimate made on January 2 of 1.6 per cent.
The Reuters poll expected no revision of the initial quarterly number.
The economy grew 3.2 per cent for all of last year, said the ministry, compared with its 3.3 per cent advance estimate.
It kept Singapore’s GDP growth forecast for this year at between 1.5 and 3.5 per cent, but added that growth would likely be slightly below the range’s midpoint.
“Singapore is still a heavily export reliant economy,” said Barnabas Gan of UOB bank.
“The weaker external environment outlook we are seeing right now, and the semiconductor slowdown, could inject further downside risk to our 2.5 per cent outlook.”