Rising exports and a pickup in travel arrivals have given strength to expectations that Singapore is on track for an economic recovery this year, but economists are cautioning against over-optimism.
Retail sales growth and government comments that the economy will avoid a recession after contracting 4.3 percent in the second quarter have added to the sentiment that Singapore has shrugged off this year's SARS-induced slump.
The most positive data came Thursday when the government released figures showing that non-oil domestic exports (NODX) soared 18.7 percent on the year last month, beating most analysts' projections.
Official projections for total trade this year were also raised from 2 percent to 6 percent to between 4 percent and 6 percent.
Lee Wee Liat, an economist with Singapore-based DBS Bank, Southeast Asia's biggest lender, said American companies were ready to increase capital investments, which should lead to a rise in demand for Singapore's technology goods, citing a recent survey. The US is Singapore's biggest trading partner.
Meanwhile, Singapore's civil aviation authority announced that passenger traffic at Changi airport rose 50 percent to 1.5 million last month over May.
The travel industry was one of the highest profile economic casualties of the SARS crisis, which killed 33 people in Singapore between mid-March and May.
The aviation authority said about 30 percent of the 1,267 flights canceled at the height of the SARS crisis had been restored and the figure was expected to reach 40 percent in mid-August.
Despite the positive economic data, economists warned that there were still concerns over the health of Singapore's economy, with the state of the US economy a vital factor.
"I think for now, the kind of figure that we have seen is still very early ... these are all early indications," said Nizam Idris, a regional economist at research house IDEAglobal.
Nizam also said last month's NODX data could have been bolstered by pent-up demand or a backlog of production that was supposed to be exported in May but were stalled because of supply chain disruptions caused by SARS.
"So last month's numbers could be misleading. That is the danger," he said.