SINGAPORE: Singapore's economy rebounded strongly in
the first quarter of 2012, according to initial estimates from the
Trade and Industry Ministry released on Friday.
The GDP grew by 9.9 per cent on-quarter in Q1, reversing a decline
of 2.5 per cent seen in the previous quarter.
On a year-on-year basis, the economy expanded by 1.6 per cent, down
from 3.6 per cent previously.
Stronger performance in the manufacturing sector has played a key
role in what some economists call a "re-acceleration" of
Singapore's economy.
The sector grew by 14.7 per cent on-quarter, driven by higher
output in the electronics and precision engineering sectors.
Irvin Seah, economist, DBS Bank, said: "All leading external
indicators for the electronics industry are pointing to a stronger
growth momentum going forward in this segment. PMI numbers for all
key markets are now above the crucial 50 level, implying that the
manufacturing sectors for some of our key markets are in strong
expansion mode."
The construction sector also grew an impressive 24.6 per cent
on-quarter in Q1. This is largely due to a pick up in residential
construction activities and public transportation projects.
Looking ahead to the second quarter, some economists said the
stable growth in the services sector - led by the financial
services and tourism industries - should help to offset any
potential moderation in the manufacturing and pharmaceutical
sectors.
The growth in visitor arrivals continued to boost the services
sector, which grew 6.9 per cent on-quarter and 2.9 per cent when
compared against the previous year.
One company that has benefited from this growth is PestBusters,
which draws about 40 per cent of its revenue from servicing
hotels.
PestBusters said contracts from hotels have risen by 25 per cent in
the last two years.
Thomas Fernandez, chairman & CEO, PestBusters, said: "If you
look at tourism and the two integrated resorts... the demand will
be strong, but the main concern with SMEs is the rising cost of
labour, rental, petrol and so forth."
Despite the economic recovery, some companies said rising business
costs have put a lid on expansion plans.
Jason Parquet, for instance, has seen profit margins trimmed by
about 5 per cent in the past year.
Jason Sim, managing director, Jason Parquet, said: "The most
important (thing) is your profit margin. The economy can grow,
everything can grow, but I think inflation affects a lot of
Singaporeans... the only way is to charge the customer
higher."
With stronger first quarter numbers, economists are likely to raise
their growth projections for the year.
The official forecast for 2012 is growth of between 1 and 3 per
cent.
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[News] S'pore economy grows faster than expected replied by Poolman @ Sat, 14 Apr 2012 06:20:02 +0800
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