Posted on 17 Dec 2008
Singapore's 2008 growth expected to be lower than projected 2.5%
Singapore's economic growth this year is expected to be lower than the government's earlier forecast of 2.5 per cent. Trade and Industry Minister Lim Hng Kiang said this is due to the unprecedented drop in global market conditions since September.
A sharp weakening in global export demand has affected Singapore and other Asian countries. As the global economy continues to slow this year, key sectors such as manufacturing has been left vulnerable to the downturn.
Some economists said they do not expect Singapore's growth to dip below two per cent.
David Cohen, director of Asian Economic Forecasting, Action Economics, said: "A closer bet would be two per cent annual growth for the full year 2008. This would be slightly below the official 2.5 per cent number but it would require just a slight contraction.
Quarter on quarter, it would be a third straight quarter-on-quarter contraction for the economy."
Looking into next year Singapore's economy is expected to shrink by as much as one per cent next year or grow by two per cent in 2009.
Economists added that growth is more likely to be nearer negative one.
Speaking at the sidelines of the ASEAN economic ministers' meeting on Tuesday, the Trade and Industry Minister said Singapore's monetary policy will be conducive to the country's economic growth.
Mr Lim said: “Singapore's current monetary policy set by MAS is very conducive to growth. We are looking toward the budget to have a fiscal policy pro-growth. Within the Singapore economy, there are some sectors that are holding relatively well."
But economists said if the global downturn is prolonged, Singapore's economy might even shrink by two per cent in 2009.
