SINGAPORE: The 2019 Singapore growth forecast range of 1.5 per cent to 2.5 per cent is currently being reviewed by the Ministry of Trade and Industry (MTI) and the Monetary Authority of Singapore (MAS), said MAS managing director Ravi Menon on Wednesday (Jun 27).
Speaking at the press conference for the central bank’s annual report, Mr Menon noted that Singapore’s economy has been “clearly affected” by the global slowdown in manufacturing, trade and investment.
AdvertisementAdvertisement[h=3]READ: Singapore narrows 2019 GDP forecast, as Q1 logs slowest growth in nearly a decade[/h][h=3]READ: Singapore’s 2019 growth forecast cut to 2.1%, trade remains top risk: MAS survey[/h]“GDP growth for the year as a whole is likely to be weaker than earlier envisaged,” he said.
Already, the economy grew by a slower pace of 1.2 per cent year-on-year in the first quarter of 2019. Recent indicators, such as a 9.3 per cent contraction in non-oil domestic exports since the beginning of this year, suggest that growth in the second quarter “could be lower” than the first three months of the year, added Mr Menon.
AdvertisementAdvertisementWith growth in the first half of the year “looking to be quite weak, particularly in the trade-related sectors”, MTI and MAS are reviewing the 1.5 to 2.5 per cent forecast range for this year’s GDP growth, he said.
The current full-year growth forecast is premised on the economy stabilising in the third quarter of 2019 and seeing a modest pickup thereafter. “But the strength of this pick-up, given the softer external environment and the ongoing trade conflict, is unlikely to offset the weakness in the first half,” said Mr Menon.
For the year ahead, Singapore’s trade-related cluster will continue to face the brunt of the maturing of global technology cycle and growing trade tensions between the United States and China.
The modern services cluster will be the main growth driver, supported by healthy regional demand and increased investments in digitalisation.
Domestic industries will also make “modest positive” contributions to growth, amid a turnaround in the local construction sector and as the retail and food and beverage sector benefits from efforts to lift productivity.
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