Singapore economy expanded 14.7% in 2010, PM says

Singapore’s economy faces a “mixed” global outlook after growing by a record pace this year, according to Prime Minister Lee Hsien Loong.

Gross domestic product rose 14.7% this year, Lee, 58, said in his New Year message released in Singapore today. That compares with the government’s November forecast of a 15% expansion. The trade ministry predicts the economy will expand 4% to 6% in 2011, an estimate reiterated by Lee.

“The outlook for the world economy is mixed,” Lee said. “The U.S. economy is still weak. Europe faces serious debt crises in Greece, Ireland and a few other countries.”

Singapore’s rebound this year from a 2009 global recession has fuelled inflation, prompting the central bank to allow faster currency gains and leading the government to implement measures to cool the property market. The estimated expansion for 2010 would make the city of 5 million people the fastest-growing economy in the world after Qatar’s, according to International Monetary Fund estimates.

“In Asia, growth momentum is strong,” Lee said. “China and India are forging ahead, and countries in Southeast Asia are growing steadily. Hopefully Asia will continue to do well despite the weakness in developed countries, and create a favorable regional environment for Singapore.”
 

Quarterly Growth
The economy grew 12.5% in the fourth quarter from a year earlier, Lee said. That compares with the 13.2% median estimate of 12 economists surveyed by Bloomberg News.

GDP probably increased about 6.5% this quarter from the previous three months, based on the year-on-year growth rate estimated by Lee today, said Song Seng Wun, an economist at CIMB Research Pte in Singapore. That compares with the median forecast for an annualised 9.4% expansion in a Bloomberg survey of eight economists.

The economy contracted 18.7% from July to September. The trade ministry will release the fourth-quarter economic report at 8 a.m. on Jan. 3.

Singapore, the second-busiest container port globally, is located at the southern end of the 600-mile (966-kilometer) Malacca Strait, the world’s busiest sea lane.

The island has remained vulnerable to fluctuations in overseas demand for manufactured goods even after the government boosted financial services and tourism.

The country’s first casinos opened this year as part of so- called integrated resorts run by Genting Singapore Plc and Las Vegas Sands Corp., luring tourists to their gambling centers, restaurants, malls and a Universal Studios theme park.

The city state added 82,000 jobs in the nine months through September, pushing the unemployment rate to 2.1%, the lowest level in 2 1/2 years. Average wages before adjusting for inflation rose 5.4% in the third quarter from a year earlier.