GDP growth to moderate to 3.8% in 2022
In 2021, GDP growth hit 7.1%.
Singapore’s growth domestic product (GDP) growth will moderate in 2022 to 3.8%, slower than 2021’s strong record of 7.1%.
Maybank, in its report, said the slower growth of GDP in 2022 will be due to the easing of momentum in the manufacturing sector next year.
The easing of manufacturing momentum is primarily because semiconductor production is already operating near full capacity. Semiconductor production accounts for 36% of total manufacturing.
Meanwhile, chip output growth has also decelerated to 3.9% in October, from 8.1% in the third quarter in 2021 and 20% in the second quarter of the same year.
Maybank said growth for 2022 will likely be driven by a broader services and construction recovery instead.
However, construction will still remain below pre-pandemic levels, the analyst added.
Meanwhile, consumer-facing and travel-related sectors like F&B, retail, recreation, hospitality are expected to “recover more strongly” next year given the economic reopening and expansion of Vaccinated Travel Lanes (VTLs).
Singapore has VTL schemes with 18 countries, the largest markets being Indonesia (16.3% of total arrivals), India (7.4%), and Malaysia (6.4%).