Pharma growth defies Singapore IP decline prediction for September

Industrial production increased by 9.8% increase during the month.

Singapore’s industrial production (IP) remained stable at a 9.8% year-on-year growth in September compared to August bucking analyst prediction of a 7.2% decline for the month, according to UOB.

Strong performance in September was attributed to significant growth in pharmaceutical production which grew 143.9% compared to a 14.1% decline in August.

The report said this growth was not just due to a low comparison base but also because of a different mix of pharmaceutical ingredients and increased production of biological products.

However, excluding the biomedical sector, industrial production did see a decline in September at around -7.6% compared to a growth of 11.5% in August, leading to a smaller 4.5% year-on-year increase (compared to 28.4% in August).

Meanwhile, electronics output growth slowed to 1.9% in September (from 50% in August) as strong gains in semiconductors eased. Moreover, precision engineering improved, driven by machinery production, though transport engineering declined due to weaker aerospace and marine sectors.

Overall, industrial production showed strength, with average six-month trends pointing to a recovery in electronics. This robust performance led to a strong 11% manufacturing growth in Q3, which could boost GDP figures above earlier estimates.

Looking ahead, possible rate cuts abroad might support economic activity, but a slowdown in regional electronics exports could signal a dip for Singapore’s electronics sector in 2025.