THE Singapore economy grew by 3.7% year-on-year in the first quarter of 2022, moderating from the 6.1% expansion in the previous quarter, the republic’s Ministry of Trade and Industry said.

In releasing the republic’s economic performance in first quarter 2022 today, the ministry also maintained the 2022 gross domestic product (GDP) growth forecast at 3.0 to 5.0%, with expansion likely to come in at the lower half of the forecast range.

On a quarter-on-quarter seasonally adjusted basis, the republic’s economy expanded by 0.7%, slower than the 2.3% growth in the fourth quarter of 2021.

The manufacturing sector, among others, increased by 7.1% year-on-year, extending the 15.5% growth in the previous quarter.

“Growth during the quarter was supported by output expansions in the electronics, transport engineering, general manufacturing and precision engineering clusters, which outweighed output declines in the biomedical manufacturing and chemicals clusters,” it said.

The construction sector rose by 2.1% year-on-year, easing from the 2.9% growth in the previous quarter, as both public and private sector construction activities picked up during the quarter.

The transportation and storage sector surged by 5.9% year-on-year, a moderation from the 7.5% growth clocked in the fourth quarter.

“Within the sector, the air transport segment saw a strong pick-up in activity as the number of air passengers handled at Changi Airport rose sharply following the further easing of border measures,” the ministry said.

Meanwhile, the finance and insurance sector, expanded by 4.0% year-on-year, moderating from the 5.6% expansion in the previous quarter.

The ministry said since February, the external economic environment has deteriorated, due in part to the onset of the Russia-Ukraine war.

In particular, the ministry said the conflict has disrupted the global supply of energy, food and other commodities, which has in turn exacerbated global inflationary pressures and adversely affected the growth of many economies.

Meanwhile, stringent measures implemented in China to contain its domestic Covid-19 outbreaks are likely to weigh on its economy and contribute to global supply bottlenecks.

“Consequently, global supply disruptions are projected to be more severe and prolonged than earlier expected, potentially persisting throughout 2022,” it said.

In the US, the ministry said GDP growth is projected to moderate in 2022 while the growth outlook of the Eurozone economy has weakened, again due to the Russia-Ukraine conflict.

As for the growth of Southeast Asian economies such as Malaysia, Indonesia and Thailand, the ministry projected they will improve in 2022.

It will be supported by a pick-up in domestic demand with the easing of public health measures in these economies, as well as sustained demand for their merchandise exports, the ministry said.

Domestically, the ministry noted that there are sectors in the Singapore economy that have seen a strengthening of their growth outlook, among others, the electronics cluster.

The cluster is expected to expand more strongly than earlier projected, bolstered by robust global demand for semiconductors from the 5G and automotive markets, as well as cloud services and data centres, it said.

Taking into account the performance of the Singapore economy in the first quarter, as well as the latest global and domestic economic developments, the ministry said it continues to expect the Singapore economy to grow by 3.0 to 5.0% in 2022, although growth is now more likely to come in at the lower half of the forecast range. – Bernama, May 25, 2022.