Economy surprises with robust 7.2% Q1 growth
April 10, 2008
S'pore economy rebounds on growth in drugs output
SINGAPORE - SINGAPORE'S economy picked up speed in the first quarter of this year, rebounding from a contraction as pharmaceutical factories produced more.
A release from the Ministry of Trade and Industry on Thursday said the gross domestic product rose 7.2 per cent on a year-on-year basis in the first quarter, faster than the 5.4 per cent gain in the final quarter of 2007.
The Advance GDP estimates also revealed that the annualised, seasonally adjusted rate of 16.9 per cent in the first quarter beat economists' expectations. It had declined 4.8 per cent in the previous quarter.
The median forecast from economists polled by Reuters was for growth of 11.5 per cent after a recovery in pharmaceutical and electronics manufacturing, after an unexpected 4.8 per cent contraction in the economy in the fourth quarter of 2007.
The manufacturing sector expanded 13.2 per cent in the first quarter, compared with a 0.2 per cent growth in the previous quarter. MTI said a surge in the output of biomedical manufacturing cluster helped boost the sector.
The rest of the manufacturing clusters also enjoyed better performance except ofr transport engineering and precision engineering clusters whose growth moderated.
The construction sector expanded by 14.6 per cent, after a 24.3 per cent gain in the preceeding quarter.
The services producing industries grew steadily at 7.6 per cent. Financial services continued to be the fastest growing among the services sectors.
The advance estimate, based largely on data from January and February, gives an early indication of the economy's performance in the January to March period.
The GDP estimates for the first three months in this year will be released in May in the Economic Survey of Singapore.
Re: S'pore economy rebounds on growth in drugs output
April 10, 2008
S'pore moves to curb inflation as growth rebounds
SINGAPORE - SINGAPORE'S central bank unexpectedly further tightened monetary policy on Thursday, pushing the Singapore dollar to a record high against the US dollar, in a move aimed at keeping a lid on soaring prices.
Singapore's economy grew at an annualised, seasonally adjusted rate of 16.9 per cent in the first quarter, beating economists' expectations, government data showed on Thursday, after a surprise 4.8 per cent contraction in the fourth quarter of 2007.
The data beat a median forecast from economists polled by Reuters for growth of 11.5 per cent because of a recovery in pharmaceutical and electronics manufacturing.
'The GDP figures were stronger than what the market had predicted and that gave the Monetary Authority confidence to tighten the policy,' said Joseph Tan, an economist at Fortis.
'Strength of GDP quarter-on-quarter came from domestic sources. Where we go from here is a step in time approach but the one-up shift of the band, as opposed to the steepening of the Singapore dollar, shows that MAS recognises inflation is an imminent danger.'
The Monetary Authority of Singapore (MAS) conducts policy through the exchange rate, steering the Singapore dollar within a secret trade-weighted band against a basket of currencies, rather than by adjusting interest rates.
Growth support
Against (the) backdrop of continuing external and domestic cost pressures, an upward shift of the policy band at this point will help to moderate inflation going forward, while providing support for sustainable growth in the economy,' the central bank said in a twice-yearly monetary policy statement.
'MAS will therefore re-centre the exchange rate policy band at the prevailing level of the S$NEER. There will be no change to the slope or width of the policy band.' The Singapore dollar hit a record high, up 0.9 per cent on the news to 1.3683 per US dollar. The currency has gained around 5 per cent this year.
Ten out of the 12 economists polled by Reuters had expected the MAS to refrain from tightening monetary policy due to concerns about slower economic growth.
The other two had expected the MAS to tighten policy to fight inflation, which stood at 6.5 per cent in February. In January it hit 6.6 per cent, the highest since March 1982.
The MAS said it expected inflation in the upper half of its 4.5 per cent to 5.5 per cent forecast range this year.
Singapore is one of the first Asian countries to report GDP data each quarter. The health of its exports is seen by analysts as a barometer of demand for Asian goods.
Despite concern about slower global growth, most central banks in Asia have refrained from easing monetary policy due to high inflation.
Some analysts said a stronger Singapore dollar would further cut demand for the island's exports by making them more expensive at a time when demand in the key US market is weakening.
They also said a stronger Singapore dollar may not be as effective as before in reining in inflation because domestic factors such as a tight labour market, high wages and elevated property prices were factors as well.
The MAS tightened policy slightly at its last meeting in October as asset prices spiralled higher.
Singapore's economic growth is largely fuelled by manufacturing of products such as electronics, pharmaceuticals and oil rigs. However, the economy also relies increasingly on tourism, financial services and construction. -- REUTERS
Re: S'pore economy rebounds on growth in drugs output
As the name of the thread suggests, Singapore economy is on drug.
If not how you explain the 16.9% GDP rebound in Q1? GDP shrinked in Q4 2007 and should have shrinked further in 2008. That should give us a technical recession.
How can you have 16.9% growth in a recession? This 16.9% is a bullshit! Unless our GDP is on drug!
Re: S'pore economy rebounds on growth in drugs output
We will see a drastic drop in exports at next quarter........
....due to the dollar exchange rate of 1.35 / 1.36, we have priced out ourselves from the export business - but does anybody listen ???
Re: S'pore economy rebounds on growth in drugs output
Quote:
Originally Posted by Unregistered
We will see a drastic drop in exports at next quarter........
....due to the dollar exchange rate of 1.35 / 1.36, we have priced out ourselves from the export business - but does anybody listen ???
Wah! My salary is going to increase. Swee!
Re: S'pore economy rebounds on growth in drugs output
Quote:
Originally Posted by Unregistered
Wah! My salary is going to increase. Swee!
Because of the weakening of USD? Congrats!
Re: S'pore economy rebounds on growth in drugs output
Quote:
Originally Posted by Unregistered
We will see a drastic drop in exports at next quarter........
....due to the dollar exchange rate of 1.35 / 1.36, we have priced out ourselves from the export business - but does anybody listen ???
Its only true if a large part of our exports is to the US. But although I dont have the figures I think our economy is more diversified now so it should not affect us drastically ie the strong Sing dollar. Other major trading partners especially Europe , Japan & China ,all their currencies have strengthened against the US, some even more than the Sing dollar.
What is more worrying is if the US goes into an extended recession. At the present moment its still hazy & its difficult to tell how bad or how long the recession will be. If the subprime clouds clear by year end , then next year should be a more confident year.
Re: S'pore economy rebounds on growth in drugs output
Quote:
Originally Posted by Unregistered
We will see a drastic drop in exports at next quarter........
....due to the dollar exchange rate of 1.35 / 1.36, we have priced out ourselves from the export business - but does anybody listen ???
Good! I have more purchasing power.
Re: S'pore economy rebounds on growth in drugs output
Published April 11, 2008
Economy surprises with robust 7.2% Q1 growth
But MAS says growth is likely to ease in next few quarters as global outlook dims
By ANNA TEO
(SINGAPORE) Inflationary concerns outweigh downside growth risks - for now anyway - as the economy rebounded strongly in the first quarter. But GDP growth is expected to ease in the months ahead.
The 7.2 per cent flash estimate of Q1 growth - against sub-6 per cent consensus forecasts, and up from the preceding Q4's 5.4 per cent pace - mostly surprised on the upside. In annualised, adjusted terms, the economy - far from slipping into a technical recession, after a Q4 contraction - grew almost 17 per cent in Q1, according to the advance figures based only on January and February data.
Notably, the manufacturing sector roared back after the previous quarter's flat performance. According to the Ministry of Trade and Industry, the sector's 13.2 per cent recovery was due to a surge in the biomedical cluster and a better showing by mainly the electronics and chemicals industries.
Growth was fairly broad-based across the economy, with the services sector maintaining pace at 7.6 per cent, led by the financial services. Construction growth slowed, but to a still robust 14.6 per cent.
The Monetary Authority of Singapore - which unexpectedly tightened monetary policy yesterday - had rather a lot more to say about the growth outlook.
Singapore's economic growth is likely to ease in the next few quarters, says the central bank in its monetary policy statement.
Global growth prospects have worsened significantly of late, but regional resilience should continue to support Singapore's growth, MAS says.
And while maintaining the official forecast of 4-6 per cent growth for 2008, it adds: 'A more severe global downturn cannot be ruled out if there is a further escalation of the financial crisis in the US. If this occurs, Singapore's growth will be adversely affected.'
Meanwhile, global inflationary pressures remain high, and Singapore's consumer price inflation is expected to remain elevated in the first half of 2008, MAS says.
It now projects Singapore's 2008 inflation rate to come in at the upper half of the 4.5-5.5 per cent forecast range.
'Against this backdrop of continuing external and domestic cost pressures, an upward shift of the policy band at this point will help to moderate inflation going forward,' it says.
While surprised by the Q1 GDP figures, economists are a little divided about how much the economy will be hit by the US recession that will likely show its hand in Asia later in the year.
Standard Chartered Bank's forecasts for Singapore see GDP growth slowing sharply to just 2.8 per cent by Q4, averaging 4.5 per cent for the year.
On the other hand, HSBC economist Robert Prior-Wandesforde maintains that 'domestic fundamentals remain highly supportive of growth' and is sticking to his forecast of 6 per cent growth for 2008. He also expects no reversal of the monetary tightening at the next review in October - and sees the inflation rate easing to about 3 per cent in Q1 2009.
For at least one economist, though, the Q1 7.2 per cent GDP growth is simply 'not high enough'.
Given the robust flash estimates for manufacturing, services and construction, the numbers just do not 'add up', says Daiwa Institute of Research's P K Basu, who had forecast 8.4 per cent GDP growth for the quarter.
Could there have been a 'computation error' somewhere, he wondered. Asked about this, an MTI officer ran through the data, and found nothing amiss.
The full details of Q1 economic performance, including March figures, will be released next month.
Re: Economy surprises with robust 7.2% Q1 growth
Re: S'pore economy rebounds on growth in drugs output
Quote:
Originally Posted by Unregistered
Good! I have more purchasing power.
Not really lah. The inflation has swallowed up all your pp. Unless you don't hold cash but hedged assets, such as: ppty. Then, you will be safe.
Re: S'pore economy rebounds on growth in drugs output
Quote:
Originally Posted by Unregistered
Not really lah. The inflation has swallowed up all your pp. Unless you don't hold cash but hedged assets, such as: ppty. Then, you will be safe.
I have cash and hedged assets.
I can now buy cheaper imports.
Biomedical Sciences Sector Grows Fourfold From 2000
http://www.afp.com/english/home/imgs/logo.gif
Biomedical sciences sector grows fourfold from 2000
Agence France-Presse
Singapore
Tuesday, 15 April 2008
http://www.channelnewsasia.com/image.../php8Dc9dK.jpg
Singapore's output in biomedical sciences has increased fourfold and the city-state is positioned to further tap Asia's expanding medical market, government officials said on Tuesday.
Output in the biomedical sector reached S$24 billion (US$17.7 billion) last year, up from S$6.3 billion in 2000, when the government began to develop the sector in a bid at economic diversification, the Economic Development Board (EDB) said.
Biomedical sciences - pharmaceuticals, biotechnology, medical technology and healthcare services - last year made up 10.1% of all manufacturing output in Singapore, the EDB said in conjunction with the BioMedical Asia conference of industry players.
Asia's expanding market opportunities and talent pool are major "pull factors" for investors, and Singapore is a strategic location for companies' expansion into the region, EDB said in a statement.
"Within the next decade, we will see Asia emerge as a global powerhouse in the biomedical sciences industry. The sheer size of the market, talent and resource base cannot be ignored," Trade and Industry Minister Lim Hng Kiang said in an opening address to the conference.
While the industry faces numerous short-term challenges such as escalating research and development costs, the demand for effective medicine would continue to rise, Beh Kian Teik, deputy director of the EDB'S biomedical sciences group, told reporters.
The outlook for biomedical science in Asia is "particularly bright" as companies gear up to access the increasingly affluent and middle-class markets, said Beh.
EDB said Singapore's biomedical sector employed more than 11,500 people last year, double the number employed in the year 2000.
"The biomedical sciences sector is a key pillar of the Singapore economy," said Aw Kah Peng, assistant managing director of EDB.
