Singapore economy smacked with record decline
City state's economy suffers 16.9% annualized contraction in fourth quarter
By Chris Oliver, MarketWatch
Last update: 11:08 p.m. EST Jan. 20, 2009
Comments: 24
HONG KONG (MarketWatch) -- Singapore's economy contracted by the most on record in the fourth quarter, prompting the government to revise down its growth expectation for this year amid what it said were conditions of "faster and deeper" slowing in global economic activity.
Gross domestic product contracted at an annualized 16.9% in the October-December period from the previous quarter, the biggest fall since comparable data was published in 1976, according to data released Wednesday by the Ministry of Trade and Industry.
The decline was bigger than a 13.1% contraction for the export-and-services-sector-dependant-economy that was forecast analysts. It was also much worse than the government's initial estimate of a 12.5% decline.
Singapore's economy shrank 5.1% in the third quarter.
The city state now forecasts its economy will contact between 2% and 5% this year, downgrading its earlier forecast for a contraction of between 2% and an expansion of 1%.
"Data releases in the past two weeks for retail sales and unemployment in the U.S., industrial production in Europe, and exports by Asian economies suggest that external demand conditions have weakened to a greater extend than earlier estimated," the ministry said in a statement Wednesday.
Economists said Singapore was likely to be among the early rebounders from recession because of its relatively small size and flexibility that brings in adapting to changes in the global economy. End of Story