Singapore's economy records 2.7% y-o-y growth in Q1 2024, surpassing growth rate in the previous quarter

On a quarter-on-quarter seasonally adjusted basis, the economy expanded by 0.1%, extending the growth of 1.2% that was observed in Q4 2023.

Based on advance estimates, Singapore's economy experienced a 2.7% year-on-year growth in the first quarter of 2024, surpassing the rate of 2.2% recorded in the preceding quarter.

On a quarter-on-quarter seasonally adjusted basis, the economy expanded by 0.1%, extending the growth of 1.2% that was observed in Q4 2023.

For a sectoral breakdown, the manufacturing sector also experienced a growth of 0.8% year-on-year in Q1 2024, moderating from the 1.4% expansion in the previous quarter.

According to the estimates, shared by the Ministry of Trade and Industry on Friday (12 April 2024), output expansions in the chemicals, precision engineering and transport engineering clusters within the sector more than offset output contractions in the electronics, biomedical manufacturing and general manufacturing clusters. However, looking at a quarter-on-quarter seasonally-adjusted basis, the sector shrank by 2.9% in the first quarter — a downward trend from the expansion of 4.5% in Q4 2023.

Similarly, Singapore's construction sector continued its growth trajectory, expanding by 4.3% year-on-year, albeit a slight decline from the 5.2% growth in the previous quarter. Annual growth during the quarter was supported by an increase in public sector construction output even as private sector construction output declined. Quarter-on-quarter seasonally adjusted data revealed a contraction of 1.7% in the construction sector during the first quarter, marking a decline from the 2% expansion observed in the preceding quarter.

All sectors in the service sectors group recorded growth during the quarter. Particularly, the wholesale & retail trade and transportation & storage sectors collectively expanded by 2.7% year-on-year in the first quarter, expanding the 1% growth in the previous quarter.

Growth within the wholesale trade sector was largely driven by the machinery, equipment & supplies and 'others' segments. Meanwhile, growth in the transportation & storage sector was attributed to the water and air transport segments. Quarter-on-quarter seasonally-adjusted data showed a notable turnaround for the sectors within this group, with a growth of 1.4% in the first quarter. This contrasts with the 0.7% contraction observed in the fourth quarter of 2023.

Meanwhile, the group of sectors comprising the information & communications, finance & insurance and professional services sectors recorded improvements all across the board. As a whole, it recorded a growth of 4.2% year-on-year in the first quarter, faster than the increase of 3.6% in the previous quarter.

Growth in the information & communications sector was bolstered by continued strong demand for IT and digital solutions, while that in the professional services sector was mainly driven by the head offices & business representative offices segment. As for the finance & insurance sector, expansion was a result of the strong performance of the banking and activities auxiliary to financial services segments. That being said, the sectors as a group shrank by 4.2% on a quarter-on-quarter seasonally-adjusted basis in the first quarter, a reversal from the 4.4% growth in the preceding quarter.

Lastly, growth of the remaining group of services sectors (i.e., accommodation & food services, real estate, administrative & support services and other services sectors) came in at 2.9% year-on-year in the first quarter, exceeding than the 2% growth recorded in the previous quarter. With the exception of the administrative & support services sector, all sectors within the group expanded during the quarter.

Notably, the accommodation sector saw robust growth due to a strong recovery in international visitor arrivals. On a quarter-on-quarter seasonally-adjusted basis, the sectors in the group collectively expanded by 2.2% in the first quarter, marking a turnaround from the 0.7% contraction in the fourth quarter of 2023.

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