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Covid pandemic sends Singapore's economy to its worst ever recession in 2020

CNBC logo CNBC 1/4/2021 Yen Nee Lee
  • Singapore's economy contracted by 5.8% year over year in 2020, advance estimates by the Ministry of Trade and Industry showed.
  • That's better than official forecast for an annual contraction of between 6% and 6.5%, as activity picked up further in the fourth quarter following the easing of Covid-related restrictions.
  • On a quarter-on-quarter seasonally-adjusted basis, Singapore's gross domestic product grew 2.1% in the fourth quarter — slowing from a 9.5% growth in the previous three months, it added.
a tall building in a city: A woman, wearing a face mask as a preventive measure against the spread of the COVID-19 novel coronavirus, walks along the promenade at Marina Bay in Singapore on May 4, 2020. © Provided by CNBC A woman, wearing a face mask as a preventive measure against the spread of the COVID-19 novel coronavirus, walks along the promenade at Marina Bay in Singapore on May 4, 2020.

SINGAPORE — Singapore's economy contracted by less than expected in 2020 as activity picked up further in the fourth quarter following the easing of Covid-related restrictions, advance estimates by the Ministry of Trade and Industry showed on Monday.

The Southeast Asian economy contracted by 5.8% in 2020 compared with the previous year, said the ministry. That's better than the official forecast for an annual contraction of between 6% and 6.5%.

In the final quarter of last year, the Singapore economy shrank 3.8% compared with a year ago — an improvement from the revised 5.6% year-over-year contraction in the third quarter, the ministry said.

On a quarter-on-quarter seasonally-adjusted basis, Singapore's gross domestic product or GDP grew 2.1% in the fourth quarter — slowing from 9.5% growth in the previous three months, it added.

chart, line chart © Provided by CNBC

Singapore's trade-dependent economy was hit by a plunge in activity last year as countries globally imposed lockdown measures to slow the spread of Covid-19.

Domestically, Singapore implemented "circuit breaker" measures in early April and started lifting them since early June — although some measures have remained, such as compulsory mask-wearing in public places. That allowed most economic activity to resume in the city-state.

Here's how the different sectors performed in the fourth quarter, according to the official estimates:

  • Goods-producing industries grew 3.3% compared with the previous year, with manufacturing expanding by 9.5% year over year;
  • The construction sector recorded its fourth-straight quarter of contraction, but the 28.5% year-on-year contraction was better than the previous quarter's;
  • Services-producing industries also continued to shrink for the fourth-straight quarter, recording a 6.8% year-on-year contraction.

The advance estimates for the fourth quarter are largely based on data from October and November. The trade and industry ministry will release an update to the data in February.


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