Singapore's economy grew an annual 7.2 per cent in the first quarter, faster than the 5.4 per cent expansion recorded in the previous three months, the government said Thursday.
Last quarter's performance was also better than economists' average growth forecast of 6.4 per cent expansion.
On a quarter-on-quarter seasonally adjusted annualised basis, real gross domestic product for the first quarter of this year expanded by 16.9 per cent after dropping 4.8 per cent in the fourth quarter last year, the trade ministry said. Growth in the first quarter was powered by the manufacturing sector which expanded an annual 13.2 per cent, picking up sharply from the 0.2 per cent recorded in the previous quarter, the ministry said.
"This was largely due to a surge in the output of the biomedical manufacturing cluster, following its contraction in the previous quarter," it said.
The construction sector also posted double-digit year-on-year growth of 14.6 per cent in the first quarter although the pace was slower than the previous quarter's 24.3 per cent, the ministry said.
For the services-related sector, growth was estimated at an annual 7.6 per cent, slightly slower than the previous quarter's 7.7 per cent, it said.
"All in all, a good start to the year, but with demand in OECD countries likely to soften in the coming months, Singapore's growth could moderate going into the second-half," said Song Seng Wun, an economist with CIMB-GK Research.
He was referring to the Organisation for Economic Cooperation and Development, whose members include major industrialised countries.
Any slowdown in the world's major economies will affect Singapore because of its dependency on external trade which is more than three times the size of its gross domestic product valued at 243.17 billion Singapore dollars (179 billion US) last year.
The global economic outlook is increasingly grim, the International Monetary Fund (IMF) said Wednesday.
It said global expansion is set to slow to 3.7 per cent in 2008 amid an unfolding crisis that began in the United States whose economy, the world's biggest, is likely in a "mild recession".
Singapore and other "newly industrialised economies" should see 4.0 per cent growth, the IMF said.
According to government projections, Singapore's economy is targeted to grow between 4.0 and 6.0 per cent for the full year, slower than the 7.7 per cent of 2007.
The advance GDP estimates for the first quarter are based largely on January and February data. More detailed figures are due to be released next month. - AFP/ac
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