Singapore economy shrinks in 1st qtr as recovery slows down

Asian Economic News, April 11, 2005

SINGAPORE, April 11 Kyodo

Singapore's economy contracted 5.8 percent in the first quarter of this year over the previous quarter, according to flash estimates released Monday by the Trade and Industry Ministry.

It marked the first quarterly economic decline since the second quarter of 2003, when gross domestic product shrank by 8.4 percent on a quarter-on-quarter basis after being battered by the outbreak of the deadly SARS epidemic.

Compared to the same period last year, GDP grew only 2.4 percent in the first quarter of this year, which is the weakest quarterly performance since 2003, according to the advance estimates, based largely on economic activity in the first two months of this year.

Last year, Singapore's economy posted 8.4 percent growth due to a strong economic recovery but the government has warned that growth will moderate to between 3 and 5 percent this year, which is more in line with a maturing economy.

''The momentum from last year's economic recovery continued to subside,'' the ministry said in a statement.

It blamed the first quarter's weakness to a sharp fall in biomedical manufacturing, which also dragged down the overall manufacturing industry.