S'pore economy grows 4.3% in Q4 but analysts see challenges ahead

Trade sentiments remain on edge due to likely Trump tariffs, geopolitical tensions

- Claire Huang

The Singapore economy may have outperformed official forecasts and market expectations in 2024, but economists see a more challenging outlook for growth in 2025.

The cautious stance comes as advance estimates from the Ministry of Trade and Industry (MTI) on Jan 2 show the economy expanded 4.3 per cent year on year in the fourth quarter of 2024.

While lower than the 5.4 per cent growth in the previous quarter, the figure beat the 3.8 per cent growth forecast by economists in a Bloomberg poll.

On a quarter-on-quarter seasonally adjusted basis, the economy expanded 0.1 per cent, down from the 3.2 per cent growth in the third quarter of 2024.

For full-year 2024, the economy grew 4 per cent, MTI said, reiterating the figure announced by Prime Minister Lawrence Wong in his Dec 31 New Year message.

This was the highest growth since 2021 and comes after 2023's 1.1 per cent increase. It also beat MTI's forecast of around 3.5 per cent made in November.

MTI did not give a new forecast for 2025 growth but said in November that it sees growth slowing to a range of 1 per cent to 3 per cent. It flagged downside risk from a further escalation of geopolitical conflicts and higher uncertainty over US trade policies under the incoming Trump administration.