Economists Predict Singapore's 2007 GDP Will Rise 7.5 Per Cent

Source : AsiaOne News, Sep 5, 2007

SINGAPORE (AP) -- Singapore's economy is likely to grow 7.5 percent in 2007 on strong expansion in the financial services and construction sectors, according to a quarterly central bank survey of economists.

The Monetary Authority of Singapore's survey, issued Wednesday, shows that economists have raised their outlook for the economy from June's median growth forecast of 6.0 percent.

The government recently raised its full-year economic growth forecast to 7-8 percent from a previous target of 5-7 percent.

The survey was distributed among forecasters on Aug. 13, just as U.S. credit market concerns became increasingly likely to pose a threat to economic growth.

The survey forecasts the island republic's non-oil domestic exports growth to be 6.2 percent in 2007, slower than the 7.0 percent projected in June. The government in July lowered its exports growth target to 4-6 percent from a previous target of 7-9 percent.

The upward revision in the full-year GDP growth figure follows faster-than-expected 8.6 percent economic growth in the second quarter driven by robust expansion in services and construction.

But economists are now more optimistic about the manufacturing sector as a key growth driver.

The survey predicts the manufacturing sector to grow 7.2 percent in 2007, faster than the 6.6 percent estimated in June.

The financial services sector is expected to expand 13.5 percent compared with a 10.2 percent estimate in June, while the construction sector will grow 15 percent, faster than June's forecast of 10 percent.

The August survey of 22 economists shows Singapore's economy is likely to expand 7.8 percent on year in the third quarter of 2007, and 7.6 percent on year in the fourth quarter.