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SINGAPORE – Singapore’s manufacturing output rebounded in August, ending a three-month slump, driven by strong growth in semiconductor production and a shift toward growth in the volatile biomedical segment.
The factory’s production grew a surprisingly strong 13.7 percent compared to the same period a year ago, according to data released by the Economic Development Board (EDB) on Friday (September 25). Economists had expected a 4.6 percent increase, based on the median of their forecasts in a Reuters poll.
If biomedical manufacturing is excluded, production increased 15.3 percent.
The rebound in August readings followed an upwardly revised 7.6 percent decline in July factory output.
On a year-over-year basis, production in the key electronics group increased 44.2 percent, due to strong performance in the semiconductor segment.
A 56.9 percent jump in chip production was supported by demand for cloud services, data centers, and the 5G market, which outpaced declines in information communications and consumer electronics as well. as in the segments of computer peripherals and data storage.
So far this year, the electronics group has risen 4.1% compared to the same period in 2019.
The precision engineering group also saw significant growth, increasing 9.4% year-on-year. This was supported by increased production of semiconductor equipment. The segment has grown 11.2 percent during the first eight months of 2020.
The volatile biomedical manufacturing segment rebounded from a 24.3 percent contraction in July to post a rebound of 8.4 percent in August. This was due to increased export demand for medical instruments and increased production of biological products.
It has been Singapore’s best-performing manufacturing segment this year, with an 18% improvement compared to 2019.
On the other hand, the production of transport engineering plummeted 36 percent in August compared to the same period last year. The aerospace, marine and offshore engineering segments fell 34% and 50.7% respectively, and the coronavirus outbreak continued to slow activity in these industries.
The group is down 22.2 percent so far this year.
Manufacturing in general also registered a decrease of 18.6 percent, with decreases seen in all segments.
In particular, the food, beverage and tobacco segment fell 13.8 percent in part due to maintenance shutdowns, which affected the production of powdered milk. Miscellaneous industries fell 24.1 percent due to lower production of construction-related products, with the slow resumption of domestic construction activity.
The manufacturing industry as a whole contracted 13.3 percent in output between January and August.
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