Singapore's Ministry of Trade and Industry (MTI) announced on Thursday morning that Singapore's GDP growth forecast for 2020 was further downgraded to "-4.0 to -1.0 percent". It is the second time for Singaporean government to downgrade the forecast range since this February.
On Feb. 17, MTI downgraded the GDP growth forecast for 2020 to "-0.5 to 1.5 percent" from the previous "0.5 to 2.5 percent" on account of the COVID-19 outbreak.
"Since then, the COVID-19 outbreak has escalated, and led to a significant deterioration in the economic situation both externally and domestically," said the ministry.
Another reason for the second downgrade is Singapore's weak-than-expected economic performance in the first quarter of this year.
Based on advance estimates, the country's economy contracted by 2.2 percent year on year in the first quarter of 2020, reversing the one percent growth in the preceding quarter. On a quarter-on-quarter seasonally-adjusted annualized basis, Singapore's economy shrank by 10.6 percent in the first quarter, a sharp pullback from the 0.6 percent growth in the preceding quarter.
In a breakdown, Singapore's manufacturing sector contracted by 0.5 percent year on year in the first quarter, compared to the 2.3 percent decline in the previous quarter. The construction sector shrank by 4.3 percent year on year, a reversal from the 4.3 percent expansion in the previous quarter. The services producing industries contracted by 3.1 percent year on year, reversing the 1.5 percent increase in the previous quarter.
The advanced GDP estimate figure released on Thursday were computed largely from data in the first two months of the quarter, according to the ministry. These figures are intended as an early indication of the GDP growth in the quarter, and are subject to revision when more comprehensive data become available.
The ministry said it would release the preliminary GDP estimates for the first quarter in May.
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