Singapore, May 25, 2023 – The Singaporean authorities announced today that the country’s Gross Domestic Product (GDP) contracted by 0.4% quarter-on-quarter in the first quarter of 2023. This decline follows the 0.1% growth recorded in the fourth quarter of 2022 and is primarily attributed to the impact of the global economic slowdown, including the Chinese economy, which is Singapore’s major trading partner.
The contraction in Singapore’s GDP during Q1/23 raises concerns about the country’s economic outlook, as a further contraction in Q2 GDP figures could push the nation into a recession.
However, on a yearly basis, Singapore’s GDP for Q1/23 grew by 0.4%, slightly surpassing the initial estimate of 0.1% growth.
Economist Chua Hak Bin from Maybank expressed his apprehension, stating, “Singapore could face a technical recession if China’s reopening fails to stimulate Singapore’s recovery in Q2. By definition, a recession occurs when there are two consecutive quarters of GDP contraction.”
Despite the challenges posed by weakening foreign demand, the Singapore Ministry of Trade remains optimistic that the country’s economy will not enter a technical recession this year. They believe in the potential for recovery and are closely monitoring the situation to implement necessary measures and policies.
The authorities in Singapore are closely observing global economic developments, including the progress of China’s reopening, as it plays a crucial role in Singapore’s economic performance due to strong trade ties between the two countries. Efforts are underway to support businesses, stimulate domestic consumption, and attract investments to bolster the economy.