Singapore keeps 2009 growth forecast at -2.5 to -2.0%

The Singapore economy is expected to grow by three to five percent in 2010 but the Ministry of Trade and Industry (MTI) said growth prospects for 2009 remain the same, the Channel News Asia reported.

The MTI released the data on Thursday morning and said global economic developments suggest that the recession has ended in most countries and that GDP growth in the world's key economies has turned positive.

For the third quarter of this year, preliminary estimates show that Singapore's economy grew by 0.6 percent compared with the same period over a year earlier. This follows a contraction of 3.3 percent in the second quarter. On an annualised quarter-on-quarter basis, the economy grew 14.2 percent in the third quarter with all major sectors registering positive growth.

GDP growth in the third-quarter follows a growth of 21.7 per cent in the second quarter, making this the second double-digit expansion in a row. In Q3, it was the manufacturing sector that led growth; the sector expanded by 26.6 percent on a quarter-on-quarter basis.

Output of biomedical manufacturing continued to surge due to increased production of higher value pharmaceutical ingredients. But the construction sector slowed down, expanding by just 0.9 percent compared to the growth of 32.7 percent in the second quarter.

The services sector also showed broad based improvement, led by growth in the trade-related and tourism sectors. However, the pace of growth in the financial services sector moderated to 3.9 percent from 22.5 percent in the previous quarter.

In terms of inflation, the MTI has revised next year's forecast from one to two per cent to 2.5 to 3.5 percent. The MTI said the upward revision can be put attributed to the recent revision in the annual values of public housing properties.

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