According to advance estimates from Singapore’s Ministry of Trade and Industry, the country’s economy grew 2.8% YoY in the final quarter of 2023, marking a significant increase from the 1% expansion recorded in the third quarter. This growth rate is the fastest since the third quarter of 2022. On a quarter-on-quarter seasonally-adjusted basis, the economy expanded by 1.7%, a larger growth than the 1.3% in the third quarter. For the full year 2023, the economy grew by 1.2%, a slower pace compared to the 3.6% growth in 2022, aligning with the ministry’s expectations forecasted in November.
Singapore’s Prime Minister Lee Hsien Loong mentioned in his New Year’s message that the country “avoided a recession” in 2023 despite facing a challenging international environment, including conflicts in Gaza and Ukraine and tensions between the U.S. and China. He acknowledged that households are still feeling the pressure of a higher cost of living, although inflation is gradually coming down. Singapore narrowly avoided a technical recession in 2023, recording a 0.1% quarter-on-quarter growth in the second quarter after a 0.3% contraction in the first quarter.
The manufacturing sector, which makes up about 20% of Singapore’s economy, expanded by 3.2% YoY in the fourth quarter, reversing from the 4.7% contraction in the previous quarter. The sector had recorded consecutive year-on-year declines in the first three quarters of 2023 before the turnaround in the final quarter. The Ministry of Trade and Industry forecasted in November that Singapore’s GDP would expand by about 1% to 3% in 2024, anticipating a slowdown in major global economies like the U.S. in the first half of the year before gradually picking up in the second half.
