(Singapore, Aug 13) Singapore’s Ministry of Trade and Industry (MTI) announced today that the GDP growth forecast for 2019 has been downgraded to “0.0 to 1.0 per cent”, with growth expected to come in at around the mid-point of the forecast range.
Economic Performance in Second Quarter 2019 The Singapore economy grew marginally by 0.1 per cent on a year-on-year basis in the second quarter, moderating from the 1.1 per cent growth in the previous quarter. On a quarter-on-quarter seasonally-adjusted annualised basis, the economy contracted by 3.3 per cent, a reversal from the 3.8 per cent growth in the first quarter.
The manufacturing sector contracted by 3.1 per cent year-on-year, sharper than the 0.3 per cent contraction in the previous quarter. Manufacturing output was largely weighed down by output declines in the electronics, transport engineering and precision engineering clusters. By contrast, output in the biomedical manufacturing and general manufacturing clusters rose.
On a quarter-on-quarter seasonally adjusted annualised basis, the manufacturing sector shrank at a more gradual pace of 3.4 per cent compared to the 6.4 per cent decline in the preceding quarter. The construction sector expanded by 2.9 per cent year-on-year, extending the 2.8 per cent growth in the first quarter. Construction output was supported by public sector construction works. On a quarter-on-quarter seasonally-adjusted annualised basis, the sector shrank by 5.5 per cent, reversing from the 13.7 per cent growth in the preceding quarter.
The wholesale & retail trade sector contracted by 3.2 per cent year-on-year, larger than the 2.5 per cent decline in the previous quarter. The sector’s weak performance was led by the wholesale trade segment, which shrank mainly on account of a decline in the machinery, equipment & supplies sub-segment.
The latter was in line with the fall in Singapore’s non-oil domestic exports during the quarter, especially in electronics. Meanwhile, the retail trade segment also contracted as both motor vehicular and non-motor vehicular retail sales fell. On a quarter-on-quarter seasonally-adjusted annualised basis, the wholesale & retail trade sector shrank by 7.9 per cent, a turnaround from the 3.1 per cent growth in the first quarter.
Growth in the transportation & storage sector picked up to 2.2 per cent year-on-year, from 0.7 per cent in the previous quarter. The sector’s growth was supported primarily by the air transport and water transport segments, which expanded on the back of an increase in air passengers handled at Changi Airport and total sea cargo volume handled at Singapore’s ports respectively. On a quarter-on-quarter seasonally-adjusted annualised basis, the transportation & storage sector grew by 6.5 per cent, reversing the 2.1 per cent decline in the preceding quarter.
The accommodation & food services sector expanded by 0.9 per cent year-on-year, slowing from the 2.0 per cent growth in the previous quarter. Growth was supported by both the food services and accommodation segments. The food services segment expanded on account of higher sales at fast food outlets, other eating places and restaurants, while the accommodation segment grew on the back of a rise in international visitor arrivals.
On a quarter-on-quarter basis, the accommodation & food services sector expanded at a seasonally-adjusted annualised rate of 2.3 per cent, a turnaround from the 5.3 per cent contraction in the preceding quarter.
The information & communications sector grew by 4.1 per cent year-on-year, easing from the 5.2 per cent growth in the previous quarter. Growth was driven by the IT & information services segment, which expanded at a robust pace on the back of healthy demand for IT solutions. On a quarter-on-quarter seasonally adjusted annualised basis, the information & communications sector grew by 0.5 per cent, slower than the 2.8 per cent growth in the preceding quarter.
Growth in the finance & insurance sector came in at 5.2 per cent year-on-year, faster than the 3.2 per cent expansion in the previous quarter. The sector’s strong performance was largely due to expansions in the fund management, foreign exchange trading, and “others” segments. On a quarter-on-quarter seasonally adjusted annualised basis, the finance & insurance sector grew by 7.6 per cent, accelerating from the 4.9 per cent growth in the first quarter.
