Singapore's Growth Probably Exceeded 20% Last Quarter on Exports, Casinos
Singapore’s economy probably grew more than 20 percent for a second quarter as rising exports boosted manufacturing output and the opening of two casinos spurred tourist arrivals.
Gross domestic product rose an annualized 23 percent in the second quarter from the previous three months, after climbing 38.6 percent in the January-to-March period, according to the median estimate of 12 economists surveyed by Bloomberg News. The trade ministry will release the data at 8 a.m. tomorrow.
Singapore’s strengthening economy has added to an Asian rebound that prompted central banks to raise interest rates in recent weeks, even amid concern that Europe’s debt crisis will slow the global recovery. The nation has raised its GDP forecast twice this year and Credit Suisse Group AG and Oversea-Chinese Banking Corp. predict the island may overtake China as Asia’s fastest-growing economy in 2010.
“The strength of the first-quarter recovery took most by surprise, and Singapore could see an even more impressive second quarter, judging by the latest manufacturing data,” said Alvin Liew, a Singapore-based economist at Standard Chartered Plc. The country also benefited from “robust tourist arrivals,” lured by new attractions, he said.
The benchmark Singapore stock index rose 0.3 percent at 9:37 a.m. local time, and has climbed 29 percent in the past year. The island’s currency added 0.2 percent to 1.3809 per U.S. dollar, bringing this year’s gain to 1.5 percent.
Singapore’s manufacturing increased an average 45 percent in the first five months of 2010, after declining an average 13 percent in the same period last year. Pharmaceutical output has at least doubled every month from March to May.
“Pharmaceuticals and electronics did very well last quarter, while trade services and tourism arrivals helped beef up growth,” said Enrico Tanuwidjaja, a regional economist at OSK-DMG Group in Singapore. “We are expecting the momentum in manufacturing to slow in the second half.”
The performance of Singapore’s pharmaceutical industry is volatile as production swings by companies such as Sanofi- Aventis SA can cause industrial output to fluctuate.
The opening of two casino resorts by Genting Singapore Plc and Las Vegas Sands Corp. this year, which include a theme park and convention centers, has contributed to record tourist arrivals every month through May and is helping fuel employment.
Singapore’s trade promotion industry will also release export figures tomorrow. Overseas shipments may rise 22.6 percent in June from a year earlier, after a 24.4 percent gain in May, according to the median estimate of 10 economists. Non- oil domestic exports will probably gain between 15 percent and 17 percent in 2010, the government said in May.