Singapore's economic growth contracted 0.9 percent in the second quarter from a year earlier and there is no sign of an immediate turnaround, the government said yesterday.
"Forward-looking indicators also point to continued weakness in the Singapore economy," the trade and industry ministry said.
The trade-driven economy was a victim of the global slowdown, especially in the crucial manufacturing sector which contracted by 9.6 percent in the second quarter in its worst performance in 16 years, the ministry.
"This was due mainly to the electronics products industry which deteriorated further to fall by 19 percent. All key segments, except computers, saw negative growth," the ministry said.
The grim year-on-year figures were reflected in rising unemployment, now at 2.6 percent and expected to reach 4.0 percent by the end of the year.
There were 5,600 jobs lost in the second quarter, 72 percent more than the 3,248 retrenchments in the first quarter.
The ministry of trade and industry said the forward-looking indicators pointed to continued weakness in the Singapore economy, but it surprised economists by maintaining its full-year growth forecast of 0.5 to 1.5 percent.
"For that growth to come to fruition it would take a significant boost in output in the fourth quarter, as the third quarter is already being seen as worse than the second," said Barclays Capital economist Desmond Supple.
"We believe there is a risk of an undershoot in the ... forecast."
An economist at SG Securities suggested the government could not announce negative growth for the full year "as that would shock the market."
"It seems a bit unlikely there will be a turnaround this year. We are already into August so we are running out of months," he said.
The 0.9 percent contraction in gross domestic product (GDP), telegraphed by Prime Minister Goh Chok Tong is his somber National Day message this week, was worse than last month's initial estimate of a 0.8 percent shrinkage.
In the first quarter, GDP rose a revised 4.7 percent year-on-year.
Singapore is already in a technical recession from two consecutive quarters of quarter-on-quarter GDP contraction. Trade ministry chief economist Tan Kong Yam said that with an expected negative third quarter Singapore was heading into a full textbook recession of consecutive quarters of year-on-year contraction.
All sectors of the economy registered slower growth in the second quarter except for financial services.
Almost 9,000 workers have been laid off so far this year and the worst is yet to come.
"Unemployment is likely to rise further in the months ahead as the full impact of the economic downturn filters into the labor market," the trade ministry said.
"Business expectations surveys also indicate a prevailing pessimistic outlook."
"In particular, firms engaged in retailing and wholesaling anticipate business conditions to be difficult. Manufacturing firms are also pessimistic about business prospects for the next six months."
The government is aiming to recruit 1,096 foreign English teachers and teaching assistants this year, the Ministry of Education said yesterday. The foreign teachers would work closely with elementary and junior-high instructors to create and teach courses, ministry official Tsai Yi-ching (蔡宜靜) said. Together, they would create an immersive language environment, helping to motivate students while enhancing the skills of local teachers, she said. The ministry has since 2021 been recruiting foreign teachers through the Taiwan Foreign English Teacher Program, which offers placement, salary, housing and other benefits to eligible foreign teachers. Two centers serving northern and southern Taiwan assist in recruiting and training
WIDE NET: Health officials said they are considering all possibilities, such as bongkrekic acid, while the city mayor said they have not ruled out the possibility of a malicious act of poisoning Two people who dined at a restaurant in Taipei’s Far Eastern Department Store Xinyi A13 last week have died, while four are in intensive care, the Taipei Department of Health said yesterday. All of the outlets of Malaysian vegetarian restaurant franchise Polam Kopitiam have been ordered to close pending an investigation after 11 people became ill due to suspected food poisoning, city officials told a news conference in Taipei. The first fatality, a 39-year-old man who ate at the restaurant on Friday last week, died of kidney failure two days later at the city’s Mackay Memorial Hospital. A 66-year-old man who dined
EYE ON STRAIT: The US spending bill ‘doubles security cooperation funding for Taiwan,’ while also seeking to counter the influence of China US President Joe Biden on Saturday signed into law a US$1.2 trillion spending package that includes US$300 million in foreign military financing to Taiwan, as well as funding for Taipei-Washington cooperative projects. The US Congress early on Saturday overwhelmingly passed the Further Consolidated Appropriations Act 2024 to avoid a partial shutdown and fund the government through September for a fiscal year that began six months ago. Under the package, the Defense Appropriations Act would provide a US$27 billion increase from the previous fiscal year to fund “critical national defense efforts, including countering the PRC [People’s Republic of China],” according to a summary
‘CARRIER KILLERS’: The Tuo Chiang-class corvettes’ stealth capability means they have a radar cross-section as small as the size of a fishing boat, an analyst said President Tsai Ing-wen (蔡英文) yesterday presided over a ceremony at Yilan County’s Suao Harbor (蘇澳港), where the navy took delivery of two indigenous Tuo Chiang-class corvettes. The corvettes, An Chiang (安江) and Wan Chiang (萬江), along with the introduction of the coast guard’s third and fourth 4,000-tonne cutters earlier this month, are a testament to Taiwan’s shipbuilding capability and signify the nation’s resolve to defend democracy and freedom, Tsai said. The vessels are also the last two of six Tuo Chiang-class corvettes ordered from Lungteh Shipbuilding Co (龍德造船) by the navy, Tsai said. The first Tuo Chiang-class vessel delivered was Ta Chiang (塔江)