The Ministry of Trade and Industry (MTI) has raised its GDP growth forecast to 6–7 percent, up from 4–6 percent forecast in May.
Singapore is positive about its growth prospects despite rising Covid-19 cases around the globe due to the Delta variant, as the vaccination rates in the country and in key economies such as the U.S. and countries in the eurozone have progressed, which have allowed them to press on with reopening plans, MTI said in an announcement on Wednesday.
«Barring a major setback in the global economy, the Singapore economy is expected to continue to see a gradual recovery in the second half of the year, supported in large part by outward-oriented sectors,» MTI said in the announcement.
At the same time, the ministry cautioned that growth in the key Southeast Asian economies in the second half of 2021 is likely to be slower than earlier projected. This is because countries that have been slow to vaccinate their populations have had to re-impose restriction measures to curb a resurgence in infections, which has in turn dampened their outlook.
Gradual Recovery
Domestically, Singapore's economy performed better than expected in the first half of 2021, growing 7.7 percent year-on-year, MTI said, citing the stabilizing Covid-19 situation and progress in the country's vaccination program.
Singapore is relaxing some of its Covid-19 curbs this week, with some 70 percent of the population now fully vaccinated, and 79 percent receiving at least one dose.
The finance and insurance sector grew 9.1 percent year-on-year, higher than the 5.7 percent in the previous quarter, supported by the banking segment, which grew due to the continued increase in net fees and commissions and interest income from loans, as well as sustained demand for life insurance products.
