Singapore cuts growth outlook

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Singapore Prime Minister Lee Hsien Loong’s city state could face a recession this year

The city state of Singapore, facing headwinds from weakening exports and lower demand for financial services, has set  its growth forecast for 2012 to the lower end of the anticipated 1.5 to 2.5 bracket defined earlier this year.

Singapore’s trade ministry also said in statement on November 16 that growth will remain subdued in 2013, giving a forecast of between 1 to 3 per cent.

Export numbers of Singapore showed weakness in the past quarter especially in electronics manufacturing and financial services, and risks remain from the US fiscal cutback and the euro zone crisis, the ministry said.

The city state, Southeast Asia’s financial hub and home to one of the world’s busiest container ports, has remained vulnerable to fluctuations in overseas demand for manufactured goods even though the government has boosted the financial services and tourism industries to reduce reliance on exports.

Singapore’s trade-dependent economy is very sensitive to external demand because exports make up more than 200 per cent of its GDP, making it one of the most vulnerable economies in the event of a global slowdown.

Another reason for the slowdown of the economy is that Singapore is currently undertaking a major restructuring process including the tightening of foreign labour to provide more jobs to its domestic workforce.

Concerns have been expressed by economist that the country even might enter a technical recession in 2012.

However, Singapore’s Trade and Industry Minister Lim Hng Kiang said the pipeline of investments coming into Singapore continues to remain strong and inflation remains under control.

“[A recession]  may come, there is no way we can predict. When we give the range of around 1.5 per cent growth for this year, at the low end, it involves a technical recession,” Kiang was quoted as saying by Channel News Asia.

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[caption id="attachment_5504" align="alignleft" width="300"] Singapore Prime Minister Lee Hsien Loong's city state could face a recession this year[/caption] The city state of Singapore, facing headwinds from weakening exports and lower demand for financial services, has set  its growth forecast for 2012 to the lower end of the anticipated 1.5 to 2.5 bracket defined earlier this year. Singapore's trade ministry also said in statement on November 16 that growth will remain subdued in 2013, giving a forecast of between 1 to 3 per cent. Export numbers of Singapore showed weakness in the past quarter especially in electronics manufacturing and financial services,...

Reading Time: 1 minute

Singapore Prime Minister Lee Hsien Loong’s city state could face a recession this year

The city state of Singapore, facing headwinds from weakening exports and lower demand for financial services, has set  its growth forecast for 2012 to the lower end of the anticipated 1.5 to 2.5 bracket defined earlier this year.

Singapore’s trade ministry also said in statement on November 16 that growth will remain subdued in 2013, giving a forecast of between 1 to 3 per cent.

Export numbers of Singapore showed weakness in the past quarter especially in electronics manufacturing and financial services, and risks remain from the US fiscal cutback and the euro zone crisis, the ministry said.

The city state, Southeast Asia’s financial hub and home to one of the world’s busiest container ports, has remained vulnerable to fluctuations in overseas demand for manufactured goods even though the government has boosted the financial services and tourism industries to reduce reliance on exports.

Singapore’s trade-dependent economy is very sensitive to external demand because exports make up more than 200 per cent of its GDP, making it one of the most vulnerable economies in the event of a global slowdown.

Another reason for the slowdown of the economy is that Singapore is currently undertaking a major restructuring process including the tightening of foreign labour to provide more jobs to its domestic workforce.

Concerns have been expressed by economist that the country even might enter a technical recession in 2012.

However, Singapore’s Trade and Industry Minister Lim Hng Kiang said the pipeline of investments coming into Singapore continues to remain strong and inflation remains under control.

“[A recession]  may come, there is no way we can predict. When we give the range of around 1.5 per cent growth for this year, at the low end, it involves a technical recession,” Kiang was quoted as saying by Channel News Asia.

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