Singapore economy expanded by 8.5% year-on-year in 1Q 2011

The recorded growth in annual basis however is slower than the 16.4% reported on the same period last year, the Ministry of Trade and Industry Singapore reported today.

On a quarterly basis, the economy expanded by a whopping 23.5% against the single digit 3.8% in the fourth quarter of 2010.

Growth was led by the manufacturing sector. On a year-on-year basis, the sector grew by 13.9 per cent, compared to the expansion of 25.5 per cent in the previous quarter. On a seasonally-adjusted quarter-on-quarter annualised basis, the sector surged by 80.2 per cent, following a small increase of 0.7 per cent in the preceding quarter. This strong growth was driven by the electronics and precision engineering clusters, which benefitted from a pick-up in business investment in the region.

The construction sector grew by 2.6 per cent on a year-on-year basis in the first quarter, reversing the contraction of 2.0 per cent in the previous quarter. On a sequential basis, the sector grew by 14.5 per cent, after two consecutive quarters of decline. This mainly reflected an increase in building activities in
the residential segment.

The services producing industries also saw an increase in activities in the first quarter of 2011. Compared to a year ago, the services producing industries expanded by 7.2 per cent, following the growth of 8.8 per cent in the preceding quarter. On a sequential basis, the services producing industries grew by an annualised rate of 8.4 per cent, up from 5.6 per cent in the preceding quarter. Growth was driven by the financial services sector, which saw an increase in commercial bank lending activities. Trade-related services such as the wholesale and retail trade, and transport and storage sectors also expanded, in line with continued growth in global demand.