Singapore’s economy expanded at a faster-than-expected pace in the third quarter, with the city-state projecting the recovery would take hold next year.
The final reading of GDP showed the economy grew an annualized 2.1 percent in the third quarter from the previous three months, versus a projection of 0.6 percent, the Singaporean Ministry of Trade and Industry (MTI) said in a report yesterday.
The economy is forecast to expand by 0.5 to 2.5 percent next year, compared with 0.5 to 1 percent this year, it said.
Compared with a year ago, GDP expanded 0.5 percent in the third quarter, beating an estimate of 0.1 percent growth.
The median forecast in a Bloomberg survey was for growth of 0.4 percent.
“Given the growth outlook for Singapore’s key final demand markets, and the projected recovery in the global electronics cycle in the year ahead, MTI expects growth in the Singapore economy to pick up modestly in 2020 as compared to 2019,” the ministry said.
With no clarity about whether US-China trade tensions will be resolved soon, Singapore’s trade-reliant economy is showing mixed signs, with the electronics industry experiencing a tentative rebound and exports still contracting.
In a separate report yesterday, Enterprise Singapore expects non-oil export growth of 0 to 2 percent next year, compared with a contraction of 9.5 to 10 percent this year.
The central bank, the Monetary Authority of Singapore (MAS), which eased monetary policy for the first time since 2016, last month said it expects a turnaround in the economy toward year’s end, with a modest improvement next year alongside stable global prospects.
MAS Deputy Managing Director of the Economic Policy Group Edward Robinson told reporters yesterday that policy is “assessed to remain appropriate at this point in time” and the “policy stance then will depend on how the economy evolves.”
The ministry said there were “signs of stabilization in the global economy even though global growth remains weak.”
World growth is projected to see a “modest pickup” next year, led by emerging markets, while growth in Singapore’s main markets of the US and China would likely ease, it said.
Manufacturing rebounded from a recession to grow an annualized 7.6 percent in the third quarter from the previous three months. Services rose 0.4 percent, while construction contracted 0.1 percent.