Singapore looked set to become the world’s fastest-growing economy Wednesday after the government upgraded its 2010 forecast to a blistering 13 to 15 percent expansion, economists said.
The new forecast, up sharply from predicted 7.0-9.0 growth, outstrips estimates of around 10 percent growth in regional powerhouse China and came despite lingering worries over the US economy and Europe’s debt crisis.
“Singapore will be the strongest growing economy in Asia for the year and probably in the world,” said Song Seng Wun, a Singapore-based regional economist with CIMB Research.
David Cohen, a regional economist with research house Action Economics, said Singapore will “probably come on top of the charts worldwide.”
Cohen, however, said this should be seen in the context that Singapore’s economy contracted by 1.3 percent last year due to the global economic crisis, while China’s gross domestic product (GDP) grew at around 9.0 percent
Robust demand for Singapore’s manufactured exports, particularly biomedical products, resulted in the sharp upgrade for the trade-driven island’s GDP growth forecast.
Growth in the first quarter was 16.9 percent from a year ago, the Ministry of Trade and Industry said, while second quarter expansion is estimated at 19.3 percent.
The ministry said growth would moderate in the second half of the year due to a slowdown in the US recovery and sovereign debt woes in Europe.
“Although the global economy remains on a recovery path, the pace of growth has slowed,” the ministry said.
“In the US, there are now signs of a slowdown in the labour market following the recovery earlier in the year. This has affected consumer confidence. In the EU, domestic demand remains depressed as concerns over the sovereign debt crisis persist.”