Singapore’s Economy Still Records an Increase of 7.2% in 2021 Amid Pandemic
In the face of the COVID-19 epidemic, Singapore’s economy increased 7.2 percent in 2021. This increase shows that the economy is returning from a recession in 2020.
Singapore’s economy dropped by 5.4 percent in 2020, marking the country’s first annual contraction since 2001 and the lowest since independence. The figures released on Monday were in line with the Ministry of Trade and Industry (MTI)’s predictions from November of last year. The Ministry of Finance has lowered its GDP growth prediction for 2021 to “about 7%.”
According to preliminary figures, GDP increased 5.9% year over year in the fourth quarter of 2021, slowing from a 7.1 percent increase the previous quarter. The economy increased 2.6 percent quarter over quarter (seasonally adjusted) in the fourth quarter of 2021, above the previous quarter’s 1.2 percent growth.
For the whole year as well as the fourth quarter, all sectors of Singapore’s economy saw year-over-year increase. Except for construction, all sectors improved on a quarter-over-quarter seasonally adjusted basis in the fourth quarter. The fourth-quarter GDP forecasts for 2021 are mostly based on data from October and November of last year. The data provides an early estimate of GDP growth for the quarter and may be updated if more complete data becomes available.
Living In An Endemic Age
Following a surge of new infections caused by the more contagious Delta type, Singapore declared the commencement of its transition to living with endemic COVID-19 last year. Its immunisation programme was expanded to include booster injections and other age groups, as well as new ways to combat the coronavirus’s spread.
A Manufacturing Sector That Is Still Going Strong
Manufacturing output increased by 14% year over year in the fourth quarter, accelerating from 7.9% in the previous quarter. For the whole year, the sector grew at a rate of 12.8%.
Output expansions in all clusters aided growth in the last three months of 2021. Electronics and precision engineering, in particular, continued to expand at a rapid pace, owing to increasing global demand for semiconductors and semiconductor equipment.
The manufacturing sector expanded 4.2 percent quarter over quarter (seasonally adjusted) compared to 0.2 percent growth in the previous quarter. This has contributed to the overall growth recorded by Singapore’s economy.
A Thriving Construction Sector
In the fourth quarter, construction grew by 2% year over year, down from 66.3 percent in the previous quarter. For the entire year, the sector improved by 18.7%. In absolute terms, however, the construction sector’s value-added in the fourth quarter of 2019 remained 26% below pre-pandemic levels.
This was owing to labour shortages at building sites caused by border restrictions on the admission of migrant labourers. The industry fell 4.4 percent quarter over quarter, seasonally adjusted, in the fourth quarter, reversing the prior quarter’s 4.9 percent rise.
Other Services and Sectors
The growth in Singapore’s economy also had a lot to do with several other sectors. In the fourth quarter, the wholesale and retail trade, as well as transportation and storage, increased by 4.3 percent, building on the previous quarter’s 6.1 percent increase. During the quarter, all sectors within this category grew.
In the fourth quarter, the technology and communications, banking and insurance, and professional services sectors all saw a 6% increase in revenue. This is down from an increase of 8% in the preceding quarter. The Infocomm industry, in particular, grew as a result of high demand for IT and digital solutions, as well as robust gaming and software publication activities.
The remaining services sectors, which include housing and food services, real estate, administrative and support services, and other services, grew by 3.1% in the fourth quarter. Except for housing and food services, all industries increased within this category.