Monday, July 14, 2008

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Singapore Economy sees deterioration from manufacturing to tourism

Growth in tourists was down to 0.8% in April and May

Singapore Tourism Board(STB) deputy chairman and chief executive Lim Neo Chian said that SINGAPORE is 'very concerned' that the growth in visitor arrivals is slowing and is keeping a close watch on how it may affect the government's target for visitors to Singapore this year. Singapore's target for tourist arrivals is an increase 5% to 10.8 million this year. Singapore also targets the number of tourists to rise to 17 million by 2015 with the completion of the two integrated resorts.

Growth in tourists was down to 0.8% in April and May, the slowest expansion in a year, according to data from the STB. Tourists from Indonesia which constitute Singapore's biggest percentage of tourists, fell 12 per cent in May, the steepest decline among all market segments.

The decline in the number of tourists is largely the result of high inflation and weak global economic outlook which dampen travel plans.

This is yet another sign of the Singapore's economy weakening. In the last quarter, Singapore's economic growth is a mere 1.9%, largely the result of plunging orders in the manufacturing sector which has seen increase in retrenchment. However, Singapore has continued to create more jobs in the service industry as its tourism industry grows.

Analysts lower forcecast for Singapore Economic Growth for 2008 & 2009

The 1.9% economic growth estimates stunned many economists, who responded by lowering their forecasts for this year and even 2009. United Overseas Bank has trimmed its full-year forecast to 4.7 per cent and 5 per cent in 2009. It cited 'weaker-than-expected second quarter figures, the vulnerability of Singapore's open economy to an external slowdown and the impact of a strong Singdollar on exports'. CIMB-GK economist Song Seng Wun has cut his 2008 growth forecast from 5.7 per cent to 4.6 per cent. Hong Kong-based Sun Mingchun of Lehman Brothers said: 'We expect GDP growth to slow sharply to 4.3 per cent in 2008 from 7.7 per cent in 2007.' Standard Chartered's Alvin Liew, who had earlier predicted growth of 4.5 per cent, has slashed his forecast to just 3.5 per cent.

May also want to read:
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Property Price Index Graph Plotter & Online Property Valuation
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