Singapore economy posted 0.2% growth on a year-on-year basis: Chan Chun Sing

Singapore — The Singapore economy has begun slowly recovering in the new year.

According to the Ministry of Trade and Industry (MTI), based on advance estimates, the Singapore economy grew by 0.2 per cent on a year-on-year basis in the first quarter of 2021. This was a turnaround from the 2.4 per cent contraction recorded in the previous quarter, said MTI in a press release on Wednesday (April 14).

On a quarter-on-quarter seasonally adjusted basis, the economy expanded by 2.0 per cent, extending the 3.8 per cent expansion in the preceding quarter, the press release added.

Photo: MTI Press Release

The manufacturing sector grew by 7.5% on a year-on-year basis in the
first quarter, following the 10.3 per cent expansion registered in the previous
quarter.

Meanwhile, the construction sector shrank by 20.2%. But even that was an improvement from construction’s 27.4% contraction in the preceding quarter.

Wholesale and retail trade and the transportation and storage sectors also shrank by 4.1% in the first quarter.

On the other hand, information and communications, finance and insurance, and professional services sectors struck a bright note, collectively growing by 3.7%.

The remaining group of services sectors (accommodation and food services, real estate, administrative and support services and other services industries) shrank by 3.9 per cent. Still, that was an improvement from their 9.9 per cent contraction in the previous quarter.

Looking at the bright side, Trade and Industry Minister Chan Chung Sing wrote on Facebook: “The expansion is a strong signal that our economy is slowly but surely recovering from the unprecedented impact of Covid-19 last year. While we are cautiously optimistic, many downside risks remain which we will have to pay close attention to.”

Acknowledging there are still problems, he added: “The path of the pandemic remains uncertain with the emergence of new variants and the uneven global roll out of vaccine deployment. The multilateral trading system remains under stress as countries prioritise unilateral trade measures in order to protect domestic interests. Our economic recovery will also be uneven with sectors such as aviation and tourism facing a protracted recovery due to travel restrictions globally.”

The minister added that he is “glad to see that more of our companies recognise that there will be no return to a pre-Covid world and are taking proactive steps to prepare themselves for both the challenges and opportunities that will present themselves in the new economy”.

MTI and economic agencies will continue to support businesses entering the market, developing new products, and entrenching themselves in the global supply and production chain. This will help build a stronger and more resilient economy that can withstand sudden shocks in the global economy.

MTI will release the preliminary gross domestic product estimates for the first quarter of 2021, including performance by sectors, sources of growth, inflation, employment and productivity, in its Economic Survey of Singapore in May 2021.

Denise Teh is an intern at The Independent SG. /TISG