In the 1st quarter, Singapore recorded a 0.4% growth in its economy, despite its government’s cautionary statements about the global economic outlook.
While the figure beat expectations, it was down from the previous quarter’s 2.1% growth. The Ministry of Trade and Industry (MTI) warned of the emergence of “downward risks” such as rising interest rates and the escalation of the war in Ukraine.
However, MTI maintained its growth forecast for 2023 in the range of 0.5-2.5 percent.
Ministry of Commerce Permanent Secretary Gabriel Lim said at a press conference that Singapore’s foreign demand has weakened for the rest of the year.
As a major financial hub heavily dependent on trade, Singapore is often seen as a benchmark for the global economy due to its exposure to global conditions.
The ministry predicted this year’s growth was likely to fall within the range of its estimated range.
“The outlook for Singapore’s external demand for the rest of the year has weakened,” Lim told a news conference.
“In addition to the expected slowdown in advanced economies, the electronics downturn is likely to be deeper and longer than previously anticipated.”
Singapore’s economy is expected to grow 3.8 percent in 2022, up from 7.6 percent last year, as the lifting of COVID-19 restrictions and border controls helped boost economic activity.