Singapore GDP Q4 2022

GDP growth slowed significantly to 2.2% year over year in the fourth quarter, from 4.2% in the third quarter. The fourth quarter reading marks the weakest expansion since the first quarter of 2021.

The industrial sector contracted by 1.3% annually in the fourth quarter, in contrast to the third quarter’s increase of 2.1%, which was the worst result since the second quarter of 2020. This was the result of contractions in the electronics, chemicals and biomedical sectors, which were more than offset by strong construction . activity growth. Additionally, the services sector lost ground, growing 4.1% in the fourth quarter (Q3: +5.8% yoy). However, the hospitality sector continued to record significant expansion thanks to the post-pandemic recovery in tourism.

On a seasonally adjusted quarterly basis, economic growth slowed to 0.2% in the fourth quarter, compared to the previous quarter’s expansion of 1.1%.

The economy is expected to lose steam in the first quarter on the back of declining demand for commodities from developed markets. However, the recovery of tourism, the supportive fiscal stance, and the reopening of China will provide support.

Commenting on the outlook for 2023 as a whole, Alvin Liu of United Overseas Bank said:

“We expect the US and European economies (which are the main end markets for Singapore) to enter recession this year amid tight monetary policy tightening of the situation among these advanced economies. This will directly affect the manufacturing and offshore services sectors. We expect the manufacturing sector to contract by 5.4% in 2018. 2023 (from +2.6% for 2022). The upward growth factors can be attributed to the continued recovery in leisure, business and domestic air travel, which will benefit many personal services sectors, and the impact of China’s reopening from January 8.”

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