S'pore raises 2024 growth forecast, but sees economy slowing in 2025

Singapore's economy blew past estimates for third-quarter growth, leading the Government to raise its forecast for the full year of 2024.

- Angela Tan

But it also tipped growth in 2025 to slow to a range of 1 per cent to 3 per cent, reflecting heightened global uncertainties generated by Donald Trump's return to the White House, further escalation of conflicts in the Middle East and Ukraine, and China's continuing slowdown.

The official 2024 growth forecast was raised to "around 3.5 per cent" from a previous range of 2 per cent to 3 per cent, after third-quarter growth accelerated to 5.4 per cent—the strongest year-on-year growth since the fourth quarter of 2021 and higher than the 4.1 per cent initial estimate.

The full-year upgrade marks a strong rebound from 2023, when the economy grew just 1.1 per cent.

"On balance, Singapore's overall external demand outlook is expected to remain resilient for the rest of 2024," the Ministry of Trade and Industry (MTI) said on Nov 22.

"Growth in the third quarter was primarily driven by the manufacturing, wholesale trade, and finance and insurance sectors, which were bolstered in part by the upturn in the global electronics cycle," Permanent Secretary for Trade and Industry Beh Swan Gin said at a media briefing.

It brought the growth for the first three quarters to 3.8 per cent year on year, compared with 0.7 per cent for the same period in 2023, said OCBC Bank chief economist Selena Ling.

Dr Beh said: "Given the strong momentum going into the remaining quarter of the year, we cannot rule out the possibility that GDP (gross domestic product) growth could exceed 3.5 per cent this year."