Singapore's GDP contracts 12.6% in Q2: MTI

This is said to be attributable to the circuit breaker measures implemented.

Singapore’s GDP plunged 12.6% YoY in Q2, deteriorating faster than the 0.3% fall in the previous quarter, according to the Ministry of Trade and Industry (MTI). On a QoQ seasonally adjusted annualised basis, the economy shrank by 41.2%.

It is also 8 percentage points higher than the 11.8% contraction expected for the quarter, based on an earlier survey of professional forecasters by the Monetary Authority of Singapore (MAS).

This is said to be attributable to the circuit breaker measures that were implemented from 7 April to 1 June, which included the suspension of nonessential services and closure of most workplace premises, as well as weak external demand amidst a global economic downturn.

Meanwhile, the manufacturing sector grew 2.5% YoY in Q2 but is slower than the 8.2% growth in the previous quarter.

Growth during the quarter was primarily due to a surge in output in the biomedical manufacturing cluster. On the other hand, weak external demand and workplace disruptions during the circuit breaker period weighed on output in the chemicals, transport engineering and general manufacturing clusters.

However, on a QoQ basis the manufacturing sector shrank by 23.1%, a sharp reversal from the 45.5% expansion in the preceding quarter.

Further, the construction sector contracted by 54.7% YoY in Q2, a significant deterioration from the 1.1% dip in Q1.

Construction output is said to have weakened on account of the circuit breaker measures which led to a stoppage of most construction activities during the period, as well as manpower disruptions, including movement restrictions at foreign worker dormitories.

On a QoQ seasonally adjusted annualised basis, the construction sector crashed 95.6% in Q2, far worse than the 12.2% contraction in the preceding quarter.

Moreover, the services producing industries contracted by 13.6% YoY in Q2, steeper than the 2.4% decline in the previous quarter.

Tourism-related sectors like accommodation and the air transport sector were severely affected by global and domestic travel restrictions. Other outward-oriented services sectors, such as wholesale trade and water transport, were adversely affected by a fall in external demand, whilst domestically oriented services sectors, such as food services, retail and business services, were significantly affected by the circuit breaker measures.

On a QoQ seasonally adjusted annualised basis, the services producing industries shrank by 37.7% in Q2, extending the 13.4% decline recorded in the preceding quarter.