Singapore economy may shrink by 5%
Singapore has slashed its 2009 GDP forecast for a second time this month, saying the economy could shrink as much as 5% as the city-state reels from plunging demand for its exports.
The gross domestic product would probably contract between 2% and 5% this year, the trade and industry ministry said.
Earlier this month, the ministry cut its forecast to between 1% growth and a 2% contraction from an initial estimate of between 2% growth and a 1% contraction.
The ministry said the economy fell a seasonally-adjusted 16.9% in the fourth quarter, a bigger drop than the 12.5% contraction initially reported earlier this month. The economy grew 1.2% last year, less than the 1.5% expansion the government reported earlier.
Non-oil exports, which account for about two-thirds of GDP, will probably fall between 9% and 11% this year, down from the government's earlier forecast of between a 1% growth and 1% contraction, the ministry's International Enterprise Singapore said.
The government also lowered its inflation forecast for this year, now expecting a range between no change in prices and a 1% drop from an earlier estimate of prices rising between 1% and 2%. Prices fell 0.6% in December, the statistics department said.
Manufacturing fell 13.5% in December from the same month the year before and dropped 11% from the previous month, the government said.