MAS predicts GDP growth of 2-2.5% in 2016

Current risks point to the downside.

Though Singapore escaped recession by the skin of its teeth, the averted crisis on its rear-view mirror seems to be the least of its problems, as subdued global growth is compounded by cyclical headwinds coming into 2016.

According to a statement by the Monetary Authority of Singapore, the economy in 2016 would likely expand at a broadly similar pace next year.

MAS says that the transport engineering cluster will continue to be limited by a cutback in oil exploration activities, while the dim outlook in IT production is also expected to persist.

"In comparison, the domestic-oriented sectors should expand at a moderate pace, underpinned by sustained demand for healthcare and education services, as well as public infrastructure spending,” they said.

Meanwhile, OCBC is predicting a higher GDP growth in 2016, citing a firmer US economy next year, which will, however, be tempered by weaker growth prospects in the region.

“The near-term outlook remains one of weakness in manufacturing, especially electronics and transport engineering due to tepid external demand conditions, whereas domestic-oriented services should still expand at a moderate pace due to better demand for healthcare and education services as well as public infrastructure spending,” OCBC said.