According to the trade ministry, disruptions to economic activity in major economies around the world as a result of the Covid-19 pandemic «have been more severe than expected.»
Singapore's economic contraction in 2020 will be greater than previously expected, said the Ministry of Trade and Industry (MTI) on Tuesday as it revised the city-state's growth forecast downwards to -4 percent to -7 percent.
The ministry previously forecast a -1 to -4 percent growth, following a first-quarter contraction of 10.6 percent, compared with 0.6 percent growth in the previous quarter, on an annualized basis.
«There continues to be a significant degree of uncertainty over the length and severity of the COVID-19 outbreak, as well as the trajectory of the economic recovery, in both the global and Singapore economies,» MTI said in a statement.
Weakened Outlook
According to MTI, the factors contributing to Singapore's weakened outlook include a slowdown in many key export markets as well as prolonged supply chain disruptions, which have adversely affected outward-oriented sectors such as manufacturing, wholesale trade, and transportation and storage.
The ongoing «circuit breaker,» which began April 4 and lasts until June 1, has dampened economic activity and domestic demand. Finally, manpower shortages caused by Covid-19 outbreaks among foreign workers, especially those living in foreign worker dormitories have affected sectors like construction and marine and offshore engineering, MTI said.
«Pockets of Resilience»
The global pandemic has however, provided a boost to certain sectors of the economy, such as the manufacture of pharmaceutical and biological products, as well as information and communications, which MTI projects to grow, given firms’ «resilient demand» for IT and digital solutions.
