Singapore economy to grow between 1% and 3% in 2024

MTI stated that gross domestic products grew 1.1% on an annual basis in the third-quarter, which is faster than 0.5% in second-quarter and 0.4% in first three months 2023. MTI’s estimated growth rate of 0.7% was also exceeded.

Analysts have said that a stronger-than-expected result in the third quarterly could be an indication of stabilisation, after anaemic economic growth in the first six months. It may also indicate a recovery that could continue into 2024.

In the third quarter, on a seasonally-adjusted basis, the economy increased by 1,4%. This is compared to the 0.14% growth in the first quarter.

The growth of the July-August quarter was helped by the recovery of the air travel industry and the inbound tourist market, which boosted sectors such as accommodation and air transport. In the meantime, a resilient labour-market continues to provide support for consumer-facing sectors such as retail trade and food services.

Even so, the effects of higher rates of interest and a Chinese economic slowdown that was less than expected has kept growth at a low level.

MTI says that, looking ahead to 2024 and due to continuing tight financial conditions in many major economies including the United States of America and Eurozone, GDP growth rates are expected to continue to slow in the early part of next year before gradually picking up in second half.

In addition to a normalisation inventory levels is expected to support a turnaround of global manufacturing activity throughout the year. It is predicted that global electronics demand will recover, which in turn will support the growth of all regional economies.

Singapore’s GDP is projected to grow between one and three percent by 2024, with trade-related sectors improving modestly. This was announced on November 22 by the Ministry of Trade and Industry.

Grand Dunman Singapore

MTI’s most recent quarterly economic survey said growth will be at around 1% in 2023 due to weaker export demand.

In the third quarter 2023, manufacturing shrank by 4,6% year-on-year, compared with a 7.6% contraction in the prior quarter. All clusters in the sector shrank except transport engineering.

Construction output increased in both the public- and the private-sector.

The forecast, which was originally 0.5 – 1.5 % in August, was now much lower.

Enterprise Singapore said on Nov. 22 that it expects a modest improvement in key exports between 2024 and 2023, following a lower forecast for 2023.

This confluence could impact both business and consumer attitudes along with demand and lead to a slowdown of global growth and trade.

Information and communications growth was down to 5.6 percent from 7% in the previous quarter. The real estate sector expanded by only 3.4 percent, down from the 12.2 per cent growth seen in the second-quarter.

It expects the non-oil domestic imports (Nodx) will decline by 12-12.5 per cent between 2023 and August, as opposed to a forecast of 9-10 per cent.

Nodx is expected to grow by 2 to 4% in 2024 due to the anticipated turn-around in global demand for electronics.

Core inflation – excluding volatile food and energy prices – in advanced economies could lead central banks into maintaining current interest rates longer. A further escalation in the Israel/Hamas war or the conflict in Ukraine could result in new disruptions to supply and commodity prices.

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