Singapore economy grew 2% in 2015, weakest since 2009

The Republic’s economy expanded by 2 per cent in 2015, the weakest annual growth since 2009 when the economy was hit by the global financial crisis, according to figures released by the Ministry of Trade and Industry (MTI) on Wednesday (Feb 24).

The figure was a sharp drop from the 3.3 per cent growth the previous year, and was revised downwards from the 2.1 per cent growth initially projected.

Growth was mainly supported by the wholesale and retail trade, and finance and insurance sectors, according to MTI.

For the fourth quarter, the economy expanded by a slower-than-expected 1.8 per cent from a year ago, after industrial production in December suffered its biggest year-on-year slump in eight months. The initial estimate was for a growth of 2 per cent.

On a quarter-on-quarter seasonally-adjusted annualised basis, the economy expanded by 6.2 per cent in the fourth quarter, MTI said.

The MTI has maintained its forecast of growth between 1 per cent and 3 per cent this year.

“Even though global growth is expected to improve, the continued slowdown in China, the services-driven nature of growth in the US, as well as the trends of in-sourcing in China and the US, may mean that external demand for our exporters may not see a significant boost this year,” said MTI’s Permanent Secretary Ow Foong Pheng.

“Lower oil prices have weakened the prospects for new rig orders for firms in the marine and offshore segment, and heightened the risks of further deterrents and cancellations of existing orders,” she added.

The economic data also showed that labour productivity, as measured by value added per worker, grew by 0.5 per cent in the fourth quarter – the first improvement since the first quarter of 2014 – driven by the wholesale and retail trade, and construction sectors.

For 2015 as a whole, overall labour productivity fell by 0.1 per cent, marginally improving from the decline of 0.5 per cent in 2014.