S’pore Economy Grows by 0.2% in the First Quarter of the Yr; Pace of Growth Unlikely to Last

By
Zhi Hao
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After months and months of economic decline, it appears that Singapore may, at long last, be back on its way up.

Though unfortunately, it may not be a long-lived one.

S’pore Economy Growth by 0.2% in the First Quarter of the Yr; Pace of Growth Unlikely to Last

According to The New Paper, the gross domestic product (GDP) has increased by 0.2 per cent on a year-on-year basis.

This is a huge improvement from the 2.4 per cent decrease recorded in the preceding quarter.

And the economy is expected to continue growing for at least another quarter too, as low base-year effects slowly take their ‘toll’.

But sharp progress may not be a long-lived notion.

According to analysts, continued repercussions of the pandemic, such as forced restrictions on international travel and decreased activity in the labour market, may cause the pace of growth to taper off.

In other words, progress may not be as significant as it is now.

“As the base effects work through the year, we expect the yearly GDP growth rate to taper to low single digits over the second half of the year,” said Mr Prakash Sakpal, senior economist at ING Group in Singapore.

However, the January to March progress has certainly surprised many, particularly analysts.

In fact, in a Bloomberg poll, the economy was actually predicted to go the other way… as much as 0.5 per cent year on year.

But like its small, humble origin, it appears that Singapore has, once again, proved itself to be above naysayers.

Meanwhile…

It appears that the same can be said for China.

The part about economic growth, anyway.

Apparently, China is reportedly all set to become the world’s largest economy by 2028…

An achievement that’s purported to be five years earlier than projected. 

According to the Centre for Economics and Business Research (CEBR), China will leapfrog the United States to become the world’s biggest economy in 2028.

This is due to the differing recoveries of the two countries from the Covid-19 pandemic.

“For some time, an overarching theme of global economics has been the economic and soft power struggle between the United States and China,” CEBR said in an annual report published on Saturday (26 December 2020).

“The COVID-19 pandemic and corresponding economic fallout have certainly tipped this rivalry in China’s favour.”

Apparently, China’s “skilful management of the pandemic”, alongside the ill fortune of the West, contributed to the growth of China’s relative economic performance.

From 2021-25, China looks set to attain an average economic growth of 5.7 per cent a year, before dipping to 4.5 per cent a year from 2026-30.

Well, it’s no wonder Singapore and China enjoy budding ties.

As they say, birds of the same feather flock together.

Though in this case, it’s a distinctly positive one.

Featured Image: Shutterstock.com / Tendo

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Zhi Hao
Email: [email protected]