(Oct 17): Prime Minister Lee Hsien Loong said Singapore will be “lucky” to see positive economic growth in 2019, casting a dark tone over the nation’s outlook as exports continue to slump.
“This year we’ll be well under 1%,” Lee said Wednesday at a conference in Singapore hosted by Forbes. “If we’re lucky we should be above zero, but the momentum has substantially diminished. And a lot of it is lack of confidence – uncertainty.”
The government’s official projection is for growth to come in at 0%-1% this year, with the central bank saying earlier this week that expansion will likely be around the midpoint of that range. Growth has slowed sharply from 3.2% in 2018 as exports took a hit amid trade tensions between the US and China, two of Singapore’s biggest trade partners.
Data on Thursday showed little improvement in exports. Non-oil domestic shipments dropped 8.1% in September from a year ago, and the critical electronics sector plunged 24.8% over the same period. Both rates came in below the median estimates in Bloomberg surveys.
Echoing other world leaders, including comments by International Monetary Fund chief Kristalina Georgieva last week, Lee identified trade tensions as the chief source of global economic woes. In Singapore, exports are equal to about 176% of gross domestic product, according to World Bank data.
“The trade disputes have cast a pall over the whole global economy – including the American economy,” Lee said. “What it means is it adds an additional layer of uncertainty, anxiety. It’s caused consumers to hold back, it’s caused investors to hold back. Trade volumes have come down, growth rates have come down. Our growth rate has come down.”
