Singapore’s recovery accelerated in the final three months of 2021, with easing virus restrictions and strong manufacturing helping push the economy to its fastest full-year growth in more than a decade.
Gross domestic product expanded 2.6% on a seasonally adjusted basis from the previous three months, according to advance estimates Monday from the Ministry of Trade and Industry, beating a median 2.1% forecast in a Bloomberg survey of economists.
That last quarter pick up helped propel growth for the full year to 7.2%, the fastest since 2010, after a 5.4% contraction in 2020. Economists had forecast an expansion of 7.1%, while the trade ministry in November said it expected “about 7%.”
“Singapore is firmly on the recovery path” with the manufacturing and services sectors driving growth, said Irvin Seah, senior economist at DBS Bank Ltd. “The main impetus that will continue to drive Singapore’s economic recovery and growth will be services” as high vaccination rates prompt the government to further ease measures, he said.
The Singapore dollar traded down 0.1% at 1.3501 to the US dollar as of 10:56 a.m local time, reversing earlier gains after the data was released. The benchmark Straits Times Index advanced 0.3%.
After recovering from the worst of the pandemic, the rapid spread of the Omicron variant and an economic slowdown in China — Singapore’s largest trading partner — are now clouding the outlook for the city-state, which is highly reliant on global trade.