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Source:
www.mti.gov.sg |
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MTI Forecasts Sustained Growth of 4.5-6.5% in 2008 |
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The Ministry of Trade and Industry (MTI)
announced today (19 Nov 2007) that the Singapore economy is expected to
grow by 7.5-8.0 per cent in 2007, and 4.5-6.5 per cent in 2008. |
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Performance in Third Quarter 2007 and
Forecast for 2007 |
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Economic growth picked up pace in the third
quarter. GDP grew by 8.9 per cent year-on-year, up from the 8.7 per cent
increase in the previous quarter. |
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Growth on an annualised quarter-on-quarter
basis declined to 4.3 per cent, down from 14.5 per cent in the second
quarter. |
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The fastest growing sectors were
manufacturing (led by the biomedical and transport engineering
clusters), financial services, and construction. |
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For the first three quarters of this year,
GDP growth averaged 8.1 per cent. The momentum is likely to continue
into the last quarter of 2007, albeit at a slower pace. Economic growth
in the US is expected to soften but the EU and Asian economies are
expected to hold up. |
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In view of this, MTI has narrowed its
full-year GDP growth forecast for 2007 from 7.0 - 8.0 per cent to 7.5 -
8.0 per cent, with growth likely to be closer to the upper end of this
range. |
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Outlook for 2008 |
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For 2008, external economic conditions are
expected to weaken slightly compared to this year. The lingering effects
of the sub-prime problems in the credit markets and a more generalised
weakening of the housing market will dampen consumption in the US. |
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Growth in the EU is also expected to soften
as a strong currency erodes export competitiveness. However, the outlook
for the Asian economies remains positive, with the Chinese economy
expected to sustain a double-digit pace of expansion. |
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MTI forecasts the Singapore economy to grow
by 4.5-6.5 per cent in 2008. This represents a moderation in growth
towards the economy's underlying potential rate, following four years of
above-trend growth. |
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The market consensus is that the US economy
will slow down in the first half of 2008 as a result of weaker credit
and housing markets before resuming healthy growth in the second half.
This would support GDP growth in Singapore in the upper half of the
4.5-6.5 per cent forecast range. |
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If the sub-prime problems worsen and
persist, or if oil prices rise further above current levels, there could
be a sharper and more protracted slowdown in the US economy. |
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This could drag Singapore’s GDP growth
towards the lower half of the forecast range. The likelihood of this
more negative scenario will become clearer only after the first quarter
of 2008. MTI will monitor the situation closely. |
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Ministry of Trade and Industry
19 November 2007 |
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More..... |
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Source:
www.mti.gov.sg Press Release 19 Nov
2007 |
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Related Article: |
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Singapore outlook for 2007 and 2008 |
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FrontPage Edition: Tue 20 November 2007
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