Hanoi (VNA) – Singapore’s annual economic growth slipped to the lowest rate in nearly a decade during this year’s first quarter as manufacturing slowed down in the wake of the prolonged US-China trade war, prompting a downgrade to the city-state’s full-year growth forecast.
According to Reuters, Singapore’s gross domestic product (GDP) expanded by 1.2 percent year-on-year during the three months ending on March 31, down slightly from the 1.3 percent seen in the government’s advance estimate and the fourth quarter’s revised 1.3 percent pace.
The result, which was below the 1.5 percent growth forecast in a Reuters poll, marked the slowest annual expansion for any quarter since April-June 2009 when GDP shrank by 1.7 percent against the previous year, government data showed.
As broad economic momentum cooled, policymakers downgraded their 2019 growth forecast from the previous 1.5-3.5 percent down to 1.5-2.5 percent.
Singapore, like many of its trade-reliant counterparts in the region, has been hit hard by the US-China trade war which has disrupted global supply chains in a blow to business investment and corporate profits.
Gabriel Lim, Singaporean Permanent Secretary for Trade and Industry, told a news briefing that slowing Chinese growth and the trade dispute between Washington and Beijing were expected to weigh on Singapore’s output, while a slackened global demand for electronics was already hitting its manufacturing sector.
“In particular, the electronics and precision engineering clusters […] are expected to face strong headwinds on account of a sharper-than-expected downturn in the global electronics cycle, as well as uncertainties arising from the ongoing trade conflicts,” said Lim.
On the flip side, manufacturers bore the brunt of the weakening global demand as it became the worst performing sector in the city-state on a quarter-on-quarter basis, down by 7.1 percent during this year’s first quarter.
The deteriorating global conditions forced Singapore to also downgrade its 2019 forecast for non-oil domestic exports by 2 percent down to 0 percent as shipments in the first quarter shrank by 6.4 percent year-on-year. –VNA
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