Singapore economy rebounds from virus-induced recession

Singapore’s economy grew 7.2% last year, rebounding from its worst recession since independence sparked by the coronavirus pandemic, government data showed Monday.

The city-state plunged into its worst economic performance in 2020 as businesses and international borders shut down, choking its trade and tourism economic lifeline.

Authorities initially imposed tough measures to restrict movement and gatherings but later shifted to a policy of living with the virus as the majority of residents got fully vaccinated.

Singapore has logged a total of 280,290 cases with 829 deaths as of Sunday.

The trade ministry released advance estimates Monday showing the economy expanded by 5.9% year-on-year in the fourth quarter to December.

This brought full-year economic growth to 7.2%, reversing a 5.4 contraction in 2020, the country’s worst since independence in 1965.

Manufacturing, a pillar of the trade-reliant economy, surged 12.8% year-on-year driven by global demand for semiconductors and semiconductor equipment, the ministry said.

Construction, a driver of domestic growth, rose 18.7% for the full year.

Prime Minister Lee Hsien Loong however said in his New Year message that Singapore was not out of the woods yet.

“Entering the new year, the fight against Covid-19 is not over. The Omicron variant has brought new uncertainties,” Lee said.

He added, however, that Singapore was in a better position to deal with the virus compared to two years ago as booster jabs have been rolled out and vaccination of children under 12 years is underway.

“We have also learnt to better manage the public health challenges while minimising the hit on our economy,” he said.

“As we brace ourselves for the impact of Omicron, we can be quietly confident that we will cope with whatever lies ahead.”

He added that the economy is expected to grow 3.0-5.0% this year.