Monday, 3 January 2005

Singapore economy returns to growth

Singapore's economy returned to growth in the fourth quarter, rising 2.4 percent on a quarter-on-quarter seasonally adjusted annualised basis, according to a Ministry of Trade and Industry press release.

The Singapore economy registered a moderation of growth in the fourth quarter of 2004. Advance estimates show that real gross domestic product (GDP) rose by 5.4 per cent in the quarter compared to the same period in 2003. On a quarter-on-quarter seasonally adjusted annualised basis, real GDP increased by 2.4 per cent, after declining by 3.0 per cent in the previous quarter.

The manufacturing sector is estimated to have expanded by a slower 9.5 per cent in the fourth quarter, mainly due to the slowdown in the electronics cluster... Activity in the construction sector...registered a smaller contraction of 7.4 per cent. Growth in the services-producing industries is estimated to be a lower 5.0 per cent as the pace of expansion eased in most major sectors...

For 2004 as a whole, the economy is estimated to have grown by 8.1 per cent in real terms. The manufacturing sector and services-producing industries expanded by 13.1 per cent and 7.5 per cent respectively, while the construction sector contracted by 6.3 per cent.

These are weak numbers and show an economy flirting with recession. Tomorrow's purchasing managers' index should give further clues on the direction of the economy.

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