Singapore’s trade-reliant economy unexpectedly contracted in the second quarter, the government said yesterday, as weak global demand weighed on the key manufacturing sector.
GDP shrank an annualized 0.8 percent quarter-on-quarter in the three months to last month, according to advance trade ministry estimates that were below market expectations.
The decline was due to a 19.4 percent quarter-on-quarter contraction in the manufacturing sector, the trade ministry said, citing a fall in the output for electronic goods, a main export for the Southeast Asian city-state.
On a year-on-year comparison, GDP rose 2.1 percent, but much slower than the 4.7 percent growth seen during the first quarter.
Growth in the construction sector fell to 5 percent from 6.4 percent the year before, and services also expanded at a slower pace at 2.8 percent from 3.9 percent.
Sectors such as construction are under pressure owing to tighter government rules for foreign labor, aimed at placating public anger over a surge in immigration analysts said.
Yesterday’s GDP figures are based on two months of data and are used to gauge the economy’s performance ahead of the release of the final numbers.
The weakness in manufacturing industries, which contribute to a fifth of Singapore’s economy, pose “downside risks to our 2014 GDP growth outlook,” Singapore’s United Overseas Bank said in a statement.
However, Capital Economic research house said that “we still expect the ongoing recovery in advanced economies to underpin reasonably healthy growth over the rest of the year.”
The government expects GDP to grow 1 to 3 percent this year, barring downside risks.
The government yesterday launched an employment Web site.
The site favors Singapore’s citizens and permanent residents, in response aimed at appeasing mounting complaints that foreigners are stealing professional jobs from locals.
The Singapore Workforce Development Agency said the Jobs Bank Web site would match employment opportunities with profiles of locals seeking employment or a change of jobs.
From Aug. 1, companies needing professional workers must advertise on the site for at least 14 days before they can seek an employment pass for a foreigner from the Ministry of Manpower.
This will allow Singaporeans to take the first crack at job openings.
Citizens and permanent residents looking for employment must create an account on the jobs bank that will allow them to apply for vacancies.
The Web site offers vacancies in sectors such as accounting, banking, engineering, science and sales.
More than 16,000 positions are currently available, about half of them for professionals, managers and executives.
Singapore’s ruling People’s Action Party has moved to curb the entry of foreign workers in the face of complaints from citizens that they are forced to compete for jobs, public housing, healthcare services and space on public transport.
Singaporeans make up just over 60 percent of the 5.4 million population, and a low fertility rate means the government has to rely heavily on an immigrant workforce.
The influx of guest workers has sparked a rise in anti-immigrant sentiment.
Abusive comments against foreigners are usually posted on anonymously run local Web sites and Facebook pages.
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