Singapore posts slowest economy expansion since 2009

Victor Kang3 Jan 2020

Singapore economy expanded by 0.7% in 2019, the lowest in the last decade. 

Singapore’s economy experienced the slowest growth in a decade last year, growing by a marginal 0.7%. This pales in comparison to the 3.1% growth recorded in 2018, reported Channel News Asia, according to Bloomberg data. 

The Ministry of Trade and Industry (MTI) said that GDP for the final three months of 2019 grew by 0.8% from the same period in 2018, which is a slight improvement from the revised 0.7% growth for the third quarter. The fourth-quarter flash estimate, meanwhile, which is generated based on data from the first two months of the quarter, was in line with a Thomson Reuters forecast.

However, on a quarter-on-quarter seasonally-adjusted annualised basis, the economy’s only grew by 0.1%. This growth is far from the 2.4% expansion recorded in the previous quarter and falls behind economists’ forecast of 0.4%.

Manufacturing sector shrank, while the services sector grew

Manufacturing decreased by 2.1% on a year-on-year basis in the fourth quarter, compared to the third quarter’s 0.9% decrease.

The services-producing industries recorded a 1.4% expansion from a year ago, which is quicker than the 0.9% growth reached in the third quarter. Meanwhile, construction expanded by 2.1% on a year-on-year basis for the fourth quarter, compared to the 2.4% growth in the previous three months.

Singapore’s economy slowed down in 2019 in the midst of a trade war between China and the US as well electronics sector going through a cyclical downturn.

This resulted in policymakers adjusting their full-year economic growth forecast three times and the most recent flash estimate released sets the forecast range from 0.5% to 1%.

“This latest advance GDP growth release confirms that the Singapore economy bottomed in the second quarter of 2019,” said Selena Ling, head of treasury research and strategy for OCBC.

“Our 2020 GDP growth forecast remains at 1 to 2 per cent year-on-year, assuming that the manufacturing recovery remains in ‘fits and starts’ pattern but with the services and construction sectors continuing to tread a firmer growth trajectory.”

All eyes on Budget 2020

Economists are also closely watching the upcoming Budget 2020, to be delivered on 18 February by Deputy Prime Minister and Finance Minister Heng Swee Keat.

READ: Property Trends: Will 2020 See The Start Of A City Fringe Condo Boom?

Ling described the Budget as the “next milestone” to watch, and added that a more expansionary fiscal budget in 2020 will probably do the required heavy-lifting for the economy in the meantime, following the Monetary Authority of Singapore’s easing of policy in October 2019.

Jonathan Koh, Standard Chartered economist, also expects a “supportive” budget because of the surplus gathered thus far in this government’s term.

“We think that there’s going to be fiscal stimulus. Fiscal spending will be a key growth driver for Singapore ahead,” he said.

Prime Minister Lee Hsien Loong said in a New Year message that the country has been affected by the slowdown in the global economy. Even though Singapore’s economy is still growing and has avoided a recession this year, it is performing “less vigorously than we would like”.

In his own New Year message, People’s Action Party first assistant secretary-general Heng also aired concerns regarding the growing global uncertainty and economic slowdown.

“We are looking at measures to tackle these, even as we build for the longer term,” he said.

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Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email



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