S'pore may post double-digit growth
S'pore may post double-digit growth
Martin Abbugao, Agence France-Presse, Singapore
Singapore may achieve double-digit economic growth this year,
its highest rate in a decade, a cabinet minister said Friday, as
robust export numbers for August gave credence to his projection.
"The good news is that Singapore's economy is recovering,"
Manpower Minister Ng Eng Hen said in a speech to a
telecommunications union.
"Singapore may even register double-digit economic growth this
year. More new jobs will be created."
It was the first time a cabinet minister has publicly said the
economy, which is rebounding sharply from the impact of the
Severe Acute Respiratory Syndrome (SARS) crisis last year, could
grow in the double-digit range.
The last time Singapore's gross domestic product (GDP) enjoyed
such growth was in 1993 when it rose more than 11 percent and in
1994 when it expanded above 12 percent.
GDP contracted in 1998 due to the Asian financial crisis and
in 2001 following a recession. Despite SARS, the economy managed
to chalk up 1.1 percent growth in 2003.
A median forecast of private economists surveyed last month by
the Monetary Authority of Singapore, the city-state's central
bank, said the economy should grow 8.4 percent this year and slow
down to 5.0 percent in 2005.
Singapore's elder statesmen Lee Kuan Yew has said the economy
could post a sustainable annual growth rate of 4.0-6.0 percent in
the next decade, lifted by the giant economies of China and
India.
Non-oil domestic exports (NODX) for August released by the
government trade body International Enterprise Singapore on
Friday gave credence to Manpower Minister Ng's projection.
The export numbers beat economists' forecasts, growing 29
percent year-on-year on the back of robust sales of electronics
and pharmaceuticals.
The rate is the strongest since a 30.7 percent expansion in
December 2003 and was better than market estimates ranging
between 20.3 and 27.4 percent.
Non-oil domestic exports for the month totaled S$11.474
billion (US$6.8 billion). Total trade in August grew 28.1 percent
year-on-year to S$49.576 billion.
David Cohen, an economist with research house Action
Economics, said double-digit growth this year was possible.
"With continued growth like this, we can certainly make it to
the 10 percent level," he told AFP.
"I think this (NODX growth) is an encouraging number. It will
support the statement by the manpower minister."
Song Seng Wun, a regional economist with GK Goh brokerage,
agreed that double-digit growth is possible -- but only if the
pharmaceuticals sector performs strongly for the rest of the year
amid forecasts for a moderation in global electronics demand.
"It is possible if the pharmaceuticals sector continues to
surprise on the upside and (there is) manufacturing growth of 22-
24 percent in the second half of this year," he said.
"It's quite demanding."
Song said export growth has peaked and should slow in the last
four months of the year.
"How much of a moderation depends on the performance of
pharmaceuticals. That's really the wild card," he said,
apparently referring to the fact that pharmaceutical plants are
closed for long periods for cleaning and maintenance after each
production cycle.
The pharmaceuticals sector is an emerging pillar of the
Singapore economy after the government embarked on an effort to
reduce dependence on electronics.
Singapore serves as a production base and regional
headquarters for many of the industry's leading global players
such as Pfizer, GlaxoSmithKline, Merck Sharpe and Dohme, Wyeth
and Schering Plough.