Singapore economy set for sluggish 6 months

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http://www.todayonline.com/Business/EDC130118-0000079/Singapore-economy-set-for-sluggish-6-months---Analysts

Singapore's economy will again see sluggish growth in at least the first half of 2013 due to persistent weakness in the macroeconomic environment, but the situation may improve in the second half of the year.

This will come on the back of gradual improvements in the US and a steady rebound in China, as Economists TODAY spoke to put the Republic's full-year gross domestic product growth rate in the range of 2.1 per cent to 3 per cent.

"Singapore's economy is very much tied to global growth," said CIMB economist Song Seng Wun, "and with global institutions such as the World Bank and International Monetary Foundation highlighting the difficulties ahead, all signs are pointing to another year of below potential growth."

Barclays' research director Leong Wai Ho also expects sluggish activities in the electronics manufacturing industry to weigh on the economy for at least the first quarter.

Singapore must continue to develop the higher value added industries. "Pharmaceutical is a great example. We expect this sector to grow at a fast pace, with 10 to 15 per cent growth per annum within the next few years," Mr Leong added.

Agreeing that the pharmaceutical segment will see relatively good growth, Mr Song pointed to transport engineering as another highlight in Singapore's manufacturing industry.

"As long as the region's low-cost carriers continue to expand and add more planes, I think the growth in the aerospace sector should still be there. Also in our offshore marine segment, order books remain fairly healthy, and we'll see steady growth going forward."