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Singapore
AsiaSoutheast Asia

Singapore’s economy grows more than expected, suggesting recovery well on track

  • The tourism sector is expected to remain robust while manufacturing and trade are seen to improve with the turnaround in global electronics demand
  • Aviation is also seen expanding, the government said, adding that resilient market conditions should support the retail and food-and-drink sectors

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Singapore national flags flutter over a view of the city state’s skyline. The government forecasts that growth may quicken next year. Photo: EPA-EFE
Bloomberg
Singapore’s economy fared better than initially thought in the third quarter as the government forecasts that growth may quicken next year, adding to signs that recovery is well on track and that a recession is unlikely.
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Gross domestic product in the three months through September grew 1.4 per cent from the previous quarter, the Ministry of Trade and Industry said in its final estimate on Wednesday. That compares with a preliminary reading of a 1 per cent expansion and a 0.1 per cent gain in the second quarter.

The economy increased 1.1 per cent in the third quarter from a year ago, compared with an earlier estimate of 0.7 per cent gain and 0.5 per cent growth in the April-June period, according to the trade ministry.

The Monetary Authority of Singapore, the city state’s central bank, has maintained inflation forecasts this year and said on Wednesday that its current policy stance is appropriate. Photo: Reuters
The Monetary Authority of Singapore, the city state’s central bank, has maintained inflation forecasts this year and said on Wednesday that its current policy stance is appropriate. Photo: Reuters

GDP growth in the first three quarters of the year stood at 0.7 per cent, prompting the government to adjust its outlook for the full-year print to around 1 per cent from the 0.5 per cent-1.5 per cent prior forecast, the ministry said in a statement. Economic expansion may accelerate further to an estimated 1 per cent-3 per cent in 2024.

While risks abound arising from elevated borrowing costs globally, volatile energy prices due to the Israel-Gaza war and China’s uneven recovery, the city state offered a sanguine outlook. The country’s tourism sector is expected to remain robust while manufacturing and trade are seen to improve with the turnaround in global electronics demand.
The travel rebound is seen to continue spurring expansion in aviation and tourism, while resilient labour-market conditions should support the retail and food-and-drink sectors, the government said.

The finance and insurance sectors should see a modest recovery in 2024 if global interest rates start to decline, according to the ministry.

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