Singapore lifts GDP forecast as export markets get vaccine boost

by AFP

SINGAPORE – Singapore on Wednesday upgraded its growth forecast for this year as the trade-reliant economy’s key export markets pick up strength thanks to rapid coronavirus vaccine rollouts.

The prosperous city-state, one of the world’s most open economies, suffered its worst ever recession last year as it was hammered by the pandemic. 

But stronger overseas demand is helping to power a rebound, which is being closely watched as Singapore is seen as a bellwether for the health of global trade. 

The economy is now expected to grow 6.0-7.0 percent for the full year, from an earlier forecast of 4.0-6.0 percent made in May, the trade ministry said.

While Covid-19 cases continue to rise globally because of the fast-spreading Delta variant, vaccination rates have increased, particularly in the United States and Europe, allowing them to press on with reopening, the ministry said.

This will offset a bleaker picture in Asia, where vaccination rates are slower and curbs on movements have been reimposed, it added.

“On balance, the recovery in external demand for Singapore for the rest of the year remains largely on track,” the ministry said.

For the second quarter to June, Singapore’s economy grew 14.7 percent on-year, taking first-half growth to 7.7 percent, it said.

The key manufacturing sector expanded 17.7 percent, extending the 11.4 percent growth recorded in the previous three months.

The domestic economy also grew following the lifting of curbs.

While some measures are still in place, the government has in recent weeks outlined plans to shift to a strategy of living with the virus over the long term as more people are given jabs.

Singapore has had a mild outbreak, reporting more than 65,000 cases and 42 deaths.