ANN/THE STRAITS TIMES – Singapore’s economic growth is accelerating and is projected to end 2024 at the higher end of the official forecast range of two to three per cent, according to Managing Director of the Monetary Authority of Singapore (MAS) Chia Der Jiun.
“Recent growth figures have been relatively strong on a year-on-year basis, placing us closer to the upper limit of the two to three per cent range,” Chia said, referencing the Ministry of Trade and Industry’s revised forecast, which had been adjusted from an earlier range of one to three per cent in August.
“For the entire year, we expect growth to land comfortably within this range, likely leaning towards the higher end,” he noted, while speaking at the Future of Finance Forum, an annual event hosted by The Bretton Woods Committee and held at UBS’s Singapore office on Friday.
His comments come shortly after private-sector economists revised their projections, estimating that Singapore’s gross domestic product (GDP) will grow by 2.6 per cent in 2024, up from their earlier prediction of 2.4 per cent in a June survey by MAS.
Chia said inflation is also easing, with the latest readings showing core inflation – this excludes private transport and accommodation costs – at 2.5 per cent in July, down from a 14-year high of 5.5 per cent in January.
“Into next year, it should move towards the range we have been historically comfortable with,” he noted in a panel discussion.
He did not give estimates for 2025, but the MAS had earlier noted that it seeks to ensure that core inflation declines to two per cent by early 2025.
Chia said Singapore growth has become more broad-based in recent months as manufacturing has turned positive after months of declines, adding to the strength of the services sector recovery in 2024. “We’re getting some pickup from the global electronic cycle, but growth has been stronger really on services,” he added.
Singapore’s manufacturing sector has started the third quarter on a positive note, expanding 1.8 per cent year on year in July, after contracting 4.3 per cent in June.
The sector shrank 1.4 per cent in the first half of 2024 and 4.3 per cent for the whole of 2023.
Chia said most South-east Asian economies are also experiencing a similar growth recovery and easing of inflationary pressures.
Meanwhile, the pressure on currencies from a stronger United States (US) dollar is also easing.
He noted that the region is also a beneficiary of the China-plus-one strategy, where many foreign companies are looking to build manufacturing capacity outside China.
