Singapore said on Friday its economy grew more than expected in the third quarter and raised its forecast for the year thanks to strong demand from key trading partners.
The Commerce Ministry said it saw expansion of “around 3.5%” in 2024, higher than the upper end of the government’s previous estimate of 2.0-3.0%.
Asian city-state economic performance is often seen as a barometer of the global environment because of its heavy reliance on international trade.
The economy grew 5.4 percent year-on-year in July-September, beating the preliminary estimate of 4.1 percent and economists’ forecast of less than 4.0 percent, the ministry said.
The reading brought average growth to 3.8 percent in the first nine months of the year, prompting the ministry to raise its full-year outlook.
It was the second upgrade this year after officials in August cut their forecast to 2.0-3.0% from 1.0-3.0%.
“Growth in the third quarter was mainly driven by the manufacturing, wholesale trade and finance and insurance sectors, partly supported by an uptick in the global electronics cycle,” the ministry said.
Manufacturing, a pillar of the economy, expanded 11.0% year-on-year, reversing a contraction of 1.1% in the previous quarter.
The rush for all things artificial intelligence has boosted demand for computer chips, a key export for Singapore.
“The electronics cluster grew strongly, supported by strong demand for smartphone and personal computer semiconductor chips, although demand for automotive and industrial semiconductor chips remained weak,” the ministry said.
Major export markets such as the United States and the Eurozone, as well as some regional economies, performed better than expected in the third quarter, according to the ministry.
The ministry, however, forecast 2025 growth at 1.0-3.0 percent due to increased global economic uncertainty, including “uncertainty over the policies of the incoming US administration, risks tilting to the downside.” is”.
