ADB raises forecast for Singapore's GDP growth in 2024 to 2.6%

Improving prospects of demand for electronic goods and financial services have lifted Singapore's economic outlook for 2024, the Asian Development Bank (ADB) said on Sept 25.

- Ovais Subhani

The Manila-headquartered bank said Singapore will clock gross domestic product (GDP) growth of 2.6 per cent in 2024, up from 1.1 per cent in 2023, and better than its April forecast of 2.4 per cent.

Meanwhile, inflation is set to decline this year and the next, it said.

The ADB upgrade comes a month after Singapore's Ministry of Trade and Industry narrowed its estimate for 2024 GDP growth to a range of 2 per cent to 3 per cent, up from an earlier projection of 1 per cent to 3 per cent.

The Republic's non-oil domestic exports rose 10.7 per cent year on year in August, mainly driven by a 35.1 per cent jump in electronic shipments.

“Exports will bolster growth in developing Asia's high-income technology-exporting economies this year,” the ADB said in its latest Asian Development Outlook report.

The ADB said it expects the momentum in global electronics demand that has driven growth in Hong Kong, South Korea, Singapore and Taiwan in the first half of the year to continue.

On Sept 3, the global Semiconductor Industry Association said world chip sales reached US$51.3 billion (S$66.1 billion) during the month of July 2024, an increase of 18.7 per cent compared with sales in July 2023, and 2.7 per cent more than June 2024. Singapore in 2023 was the world's third-largest chip supplier.

The ADB said the chip-driven rebound in exports will lift Singapore's manufacturing sector, which had shrunk by 1.7 per cent in the first quarter and 1 per cent in the second. The bank provides loans and grants to developing nations across the Indo-Pacific region.

It said Singapore will remain on a steady path of growth through next year as well. It kept its GDP growth forecast of 2.6 per cent for 2025 for the Republic unchanged.