SINGAPORE: Singapore has maintained its growth forecast for this year at 3 to 5 per cent as data on Thursday (Feb 17) showed the economy staging a recovery in 2021.
The Singapore economy expanded 7.6 per cent last year, mainly lifted by the manufacturing, finance and insurance, and wholesale trade sectors, said the Ministry of Trade and Industry (MTI) in a press release.
This marked the fastest full-year growth since 2010’s record 14.5 per cent, as the economy rebounded from a 4.1 per cent contraction in pandemic-hit 2020.
MTI noted that the outlook for Singapore’s external demand has “deteriorated slightly” since its last report in November, as many economies tightened restrictions to combat the highly transmissible Omicron variant.
Global supply bottlenecks remain and are expected to persist throughout the first half of this year. This may constrain industrial production and growth in some external economies in the near term.
These persistent supply chain snarls, alongside rising energy prices due to geopolitical tensions, have also exacerbated global inflationary pressures.
At the same time, downside risks in the global economy have increased, MTI said.
These include uncertainties about the trajectory of the COVID-19 pandemic and global supply chain disruptions, as well as a faster-than-expected monetary policy tightening in the advanced economies.
Energy prices are also facing “significant upside risks” amid supply concerns due to escalating geopolitical tensions involving Russia and Ukraine, and in the Middle East, as well as unpredictable weather conditions.
“A spike in energy prices would exacerbate inflationary pressures and weigh on global economic growth,” MTI said.
Turning to its domestic outlook, MTI noted that Singapore’s high vaccination rate and steady rollout of booster shots should “facilitate further progressive easing of domestic and border restrictions”.
“Against this external and domestic backdrop, the Singapore economy is expected to continue to expand this year, although the outlook for the various sectors remains uneven,” said MTI.
For example, while growth prospects for outward-oriented sectors are set to remain strong amid the continued global economic rebound, the recovery in the aviation- and tourism-related sectors is expected to be slow as recurring COVID-19 outbreaks and potential virus mutations could delay the lifting of travel restrictions globally. Travel demand is also likely to take time to recover.
Singapore’s economic recovery closed out 2021 on a stronger-than-expected note.
Gross domestic product (GDP) grew by 6.1 per cent on a year-on-year basis in the fourth quarter, above advance estimates of 5.9 per cent but moderating from the 7.5 per cent expansion in the preceding quarter.
This took the economy's full-year growth to 7.6 per cent.
Separate data also released on Thursday showed Singapore's non-oil domestic exports (NODX) rose 12.1 per cent year on year in 2021, following the 4.3 per cent growth in the year before, due to higher shipments of both electronic and non-electronic products.
For this year, the outlook for NODX is maintained at 0 to 2 per cent, as growth is "expected to ease from a high base" in line with global economic and trade outlook, said Enterprise Singapore.
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The Singapore economy expanded 7.6 per cent last year, mainly lifted by the manufacturing, finance and insurance, and wholesale trade sectors, said the Ministry of Trade and Industry (MTI) in a press release.
This marked the fastest full-year growth since 2010’s record 14.5 per cent, as the economy rebounded from a 4.1 per cent contraction in pandemic-hit 2020.
MTI noted that the outlook for Singapore’s external demand has “deteriorated slightly” since its last report in November, as many economies tightened restrictions to combat the highly transmissible Omicron variant.
Global supply bottlenecks remain and are expected to persist throughout the first half of this year. This may constrain industrial production and growth in some external economies in the near term.
These persistent supply chain snarls, alongside rising energy prices due to geopolitical tensions, have also exacerbated global inflationary pressures.
At the same time, downside risks in the global economy have increased, MTI said.
These include uncertainties about the trajectory of the COVID-19 pandemic and global supply chain disruptions, as well as a faster-than-expected monetary policy tightening in the advanced economies.
Energy prices are also facing “significant upside risks” amid supply concerns due to escalating geopolitical tensions involving Russia and Ukraine, and in the Middle East, as well as unpredictable weather conditions.
“A spike in energy prices would exacerbate inflationary pressures and weigh on global economic growth,” MTI said.
Turning to its domestic outlook, MTI noted that Singapore’s high vaccination rate and steady rollout of booster shots should “facilitate further progressive easing of domestic and border restrictions”.
“Against this external and domestic backdrop, the Singapore economy is expected to continue to expand this year, although the outlook for the various sectors remains uneven,” said MTI.
For example, while growth prospects for outward-oriented sectors are set to remain strong amid the continued global economic rebound, the recovery in the aviation- and tourism-related sectors is expected to be slow as recurring COVID-19 outbreaks and potential virus mutations could delay the lifting of travel restrictions globally. Travel demand is also likely to take time to recover.
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Singapore’s economic recovery closed out 2021 on a stronger-than-expected note.
Gross domestic product (GDP) grew by 6.1 per cent on a year-on-year basis in the fourth quarter, above advance estimates of 5.9 per cent but moderating from the 7.5 per cent expansion in the preceding quarter.
This took the economy's full-year growth to 7.6 per cent.
Separate data also released on Thursday showed Singapore's non-oil domestic exports (NODX) rose 12.1 per cent year on year in 2021, following the 4.3 per cent growth in the year before, due to higher shipments of both electronic and non-electronic products.
For this year, the outlook for NODX is maintained at 0 to 2 per cent, as growth is "expected to ease from a high base" in line with global economic and trade outlook, said Enterprise Singapore.
Continue reading...