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Wed, Oct 14, 2020 – 8:33 am
SINGAPORE’s third-quarter economic growth recovered from the deep contraction experienced during its “breaker” period, but has continued in negative territory, according to advance estimates released by the Ministry of Trade and Industry (MTI) on Wednesday.
Gross domestic product (GDP) grew 7.9 percent in the third quarter, on a seasonally adjusted quarter-over-quarter basis, a radical change from the 13.2 percent contraction recorded in the second quarter when Singapore was at a close partial economic due to the COVID-19 Pandemic.
However, on a year-over-year basis, the economy contracted 7 percent in the third quarter, although this is an improvement from the 13.3 percent contraction seen in the second quarter.
The best third-quarter performance came largely from the manufacturing sector, which expanded 2 percent year-on-year, undoing the 0.8 percent contraction seen in the second quarter. Quarter after quarter, the manufacturing sector grew 3.9 percent on a seasonally adjusted basis, recovering from the 9.1 percent contraction in the second quarter.
Manufacturing sector gains came primarily from production expansions in the electronics and precision engineering groups, which in turn were driven by strong global demand for semiconductor and semiconductor manufacturing equipment, MTI said.
Meanwhile, the construction sector contracted 44.7 percent year-on-year in the third quarter, extending the 59.9 percent decline from the previous quarter. However, on a seasonally adjusted quarter-on-quarter basis, the construction sector grew 38.7%, a drastic change from the sharp 59.4% contraction in the second quarter.
The construction sector’s weak year-on-year performance was attributed to the slow resumption of construction activities due to the need for construction companies to implement safe management measures for a safe restart, according to the MTI.
Service industries contracted 8 percent year-on-year in the third quarter, although this is an improvement from the 13.6 percent decline in the second quarter.
Aviation and tourism-related sectors, such as air travel and accommodation, continued to experience significant contractions, as global travel restrictions and sluggish demand for travel almost completely paralyzed air travel and visitor arrivals, he said. MTI.
Although other trade-related service sectors, such as wholesale trade, were affected by weak external demand, consumer-oriented sectors, such as retail and food services, saw an improvement in the third quarter as that Singapore gradually reopened its economy.
On a seasonally adjusted quarter-on-quarter basis, the services sector grew 6.8% in the third quarter, compared to the 11.2% contraction in the second quarter.
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