Singapore's Q3 GDP grows by 1.3% on-year

SINGAPORE: Singapore's economy grew by 1.3 percent on a year-on-year basis in the third quarter of 2012, compared to 2.3 per cent growth in the previous quarter.

On a quarter-on-quarter basis, the economy contracted by 1.5 percent, a reversal from a growth of 0.2 percent in the second quarter.

Releasing the advance GDP estimates for the third quarter on Friday, the Ministry of Trade and Industry (MTI) said the Singapore economy remains on track to grow by 1.5 to 2.5 percent in 2012.

It said economic growth in the second quarter was better than expected, resulting in an upward revision of quarter-on-quarter annualised growth from the preliminary estimates of -0.7 per cent to 0.2 per cent.

Commenting on the various sectors, MTI said the pullback in quarter-on-quarter growth momentum in the third quarter was mainly due to contraction in the manufacturing sector. The sector declined by an annualised rate of 3.9 per cent, following the 0.1 per cent contraction in the preceding quarter.

This largely reflected the decline in output of the electronics cluster. On a year-on-year basis, the manufacturing sector grew by 0.7 per cent compared to the 4.6 per cent increase in the preceding quarter.

The construction sector grew by 8.6 per cent on a year-on-year basis in the third quarter, moderating from 10.1 per cent in the previous quarter. On a quarter-on-quarter basis, the sector contracted by an annualised rate of 7.5 per cent due to a decline in private sector building activities.

Services producing industries rose by 1.1 per cent on a year-on-year basis, following the 0.9 per cent growth in the previous quarter. On a quarter-on-quarter basis, the services producing industries grew by an annualised rate of 0.1 per cent, compared to the 0.4 per cent decline in the preceding quarter.

MTI cautioned that growth could be weighed down by the subdued global economic conditions for the rest of the year. Externally-oriented sectors such as manufacturing and wholesale trade will be affected by the slowdown in advanced economies.

However, it said there will be modest support to growth from healthy expansion in the transport engineering cluster and construction sector.