, Singapore

MTI’s 2022 economy outlook stays at 3%-5%

It’s based on the first quarter economic performance and global developments.

Amidst downside risks and the recent economic performance, the Ministry of Trade and Industry (MTI), maintained that the economy will grow by 3% to 5% in 2022.

In a statement, MTI said the Lion City’s economy weakened compared to three months ago, with the gross domestic product moderately growing by 3.7% year-on-year in the first quarter of 2022. It noted that the Russia-Ukraine unrest caused a surge in energy and food commodity prices, and global economic uncertainty.  

If global supply disruptions are more severe than expected due to renewed COVID-19 outbreaks or further escalations in the Russia-Ukraine war, global industrial production may be constrained more substantially than currently projected.

Market adjustments could be disorderly and risks to financial stability could intensify if monetary policy tightening in the advanced economies is faster than anticipated. 

The trajectory of COVID-19 pandemic is also a risk for the economy and the potential emergence of more virulent strains of virus continues to pose a risk to the global economy.

In Singapore, the pandemic situation already stabilised following the cresting of the Omicron wave.

The growth outlook further weakened this year because China is a key market for petroleum and chemicals products from the Lion City. The economic slowdown of China will impact the growth prospects of Singapore’s chemicals cluster and the fuel and chemicals segment of the wholesale trade sector.

But there are sectors in Singapore's economy which have seen a boosting of their growth o
outlook, such as the electronics cluster, professional services sector, and air travel.  

With all these factors, MTI maintained its outlook that the Singapore economy will soar by 3% to 5% in 2022 but growth will likely come in at the lower half of forecast range.

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