Singapore's Output Rises at Slowest Pace Since February as Demand Cools
Singapore’s industrial production rose at the slowest pace in four months in June as pharmaceutical and electronic manufacturers made fewer goods, suggesting demand may ease as the global recovery cools.
Output at factories, which accounts for about a quarter of the economy, climbed 26.1 percent in June from a year earlier, after a revised 58.4 percent surge in May, the Economic Development Board said in a statement today. The median estimate of 10 economists surveyed by Bloomberg News was for a 38.4 percent gain.
Singapore’s economy grew at a record pace in the first half as demand for its computer chips and manufactured goods recovered from a trade slowdown that pushed the nation into a recession last year. The outlook for the rebound is clouded as governments in Europe embark on austerity programs to cut deficits and households in some of the world’s largest economies hold back spending.
“The growth momentum in the manufacturing sector is set to slow in the months ahead,” Irvin Seah, an economist at DBS Group Holdings Ltd. in Singapore, said before the report. “A subpar recovery in the U.S., slowdown in eurozone as well as tighter policy conditions in Asia are factors pointing to weaker external demand and industrial production ahead.”
Production in the second quarter rose 44.5 percent, less than the government’s preliminary estimate earlier this month of 45.5 percent. Singapore’s economy accelerated to an unprecedented 18.1 percent pace in the first half, prompting the government to raise its GDP forecast for the third time this year to as much as 15 percent.
Electronics Exports
Electronics shipments by companies including Venture Corp., Singapore’s biggest electronics contract manufacturer, climbed 43.9 percent in June from a year earlier, while pharmaceutical shipments rose 29.8 percent, a report this month showed.
Singapore’s non-oil domestic exports will probably gain between 17 percent and 19 percent in 2010, from a previous projection of as much as 17 percent, the trade promotion agency said July 14.
Industrial production dropped a seasonally adjusted 23.4 percent in June from May, when it advanced 5.2 percent from a month earlier.
Electronics production jumped 46.8 percent from a year earlier, following a revised 52.1 percent gain in May. Pharmaceutical output climbed 30.8 percent.
To contact the reporter on this story: Shamim Adam in Singapore at sadam2@bloomberg.net
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