Economists cut Singapore 2012, 2013 growth forecasts
Singapore, whose trade is three times gross domestic product (GDP), has been hurt by the downturn in Western economies that has crimped demand for its exports.
The wealthy city-state of 5.3 million people has also
underperformed neighbours such as Malaysia and Indonesia, which can rely on their much larger populations to prop up growth.
"The key thing is Singapore's small domestic market.
Regional economies, especially in the rural household sector, have benefitted from still strong resource prices so there is the domestic consumption story," said CIMB regional economist Song Seng Wun.
Economists now expect the Southeast Asian city-state's GDP to grow 1.5 percent this year, down almost a full percentage point from the median estimate of 2.4 percent in the previous poll, according to the Monetary Authority of Singapore's (MAS) latest quarterly Survey of Professional Forecasters.
In contrast, Indonesia's central bank said Tuesday it
expects full-year growth of 6.3 percent in 2012, while most
economists expect Malaysia's economy will expand by more than 5 percent this year.
However, Singapore may avoid a technical recession based on the median estimate of 1.8 percent year-on-year growth in the fourth quarter, which works out to an annualised quarter-on-quarter and seasonally adjusted expansion of around 3 percent.
The city-state's economy contracted an annualised and
seasonally adjusted 5.9 percent in the third quarter
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