Singapore’s economy developed at its slowest rate in a decade last year as its manufacturing industry contracted, preliminary data confirmed Thursday. However, fourth-quarter data firmed expectations for a modest recovery in 2020.
The export-oriented economy has been walloped by the drawn-out Sino-U.S. trade battle in addition to a cyclical global downturn in the electronics industry.
Gross domestic product (GDP) grew 0.7% last year, the slowest annual pace since 2009 and down from 3.1% in 2018. Authorities expect growth of between 0.5% to 2.5% this year, while Singapore’s largest bank DBS is forecasting a 1.4% expansion.
With the island country anticipated to hold elections within months, economists are eyeing “generous” fiscal assist to support growth on the upcoming budget on February 18.
In the fourth quarter, GDP grew 0.8% in October-December from the same interval a year in the past, the commerce ministry stated, according to analysts’ expectations, and compared with a revised 0.7% in the previous quarter.
The financial system grew 0.1% quarter-on-quarter on an annualized and seasonally adjusted basis.
Over 2019, the manufacturing industry contracted 1.5% yearly, distinctly down from 7% growth two years ago. Companies grew at an extra modest 1.1% in comparison with 2.9% in 2018 while there was a turnaround in development, which expanded 2.5% compared with a 3.7% contraction in 2018.
However, OCBC’s Selena Ling stated there was “no rush” for the next action from the central bank, which holds its subsequent semi-annual meeting in April.