Economists have raised their forecasts for Singapore’s growth this year, anticipating a firmer improvement in the manufacturing and finance sectors.
Singapore’s gross domestic product is expected to increase 5.8 percent this year, according to the median forecast of 24 economists surveyed by the Monetary Authority of Singapore.
They had expected 2021 growth of 5.5 percent in the previous survey in December.
The economists’ outlook also improved for the labor market, penciling in a lower overall unemployment rate at 2.9 percent by the year-end, according to the report released by MAS on Wednesday (Mar 10).
This is slightly lower than the 3 percent forecast in the previous survey.
The Singapore economy has been hit hard by the COVID-19 pandemic. It logged its worst-ever recession last year even with nearly S$100 billion in the stimulus.
Contraction moderated in the fourth quarter as more coronavirus-related curbs were lifted, but expectations are for a slow and uneven recovery.
For the first quarter of this year, the economy will likely remain wobbly, economists in the MAS survey said. They tipped a 1.1 percent year-on-year contraction with the construction sector remaining the biggest laggard.
As the year progresses, the construction sector is expected to recover, with economists forecasting a 22.5 percent growth for 2021. This compares with their earlier estimates of nearly 29 percent.
Their outlook also dimmed slightly for the wholesale and retail trade which is expected to grow by 4.5 percent instead of 5 percent, and for accommodation and private consumption, which is expected to rise 11 percent instead of 15 percent.
Similarly, private consumption is predicted to rise 7.9 percent, down slightly from 8.5 percent in the survey three months ago.
Expectations also improved for the finance and insurance sector at 5.8 percent, compared to the previous 5.1 percent.
Source: Channel News Asia