Singapore's 2013 economy predicted to grow 1-3%

But these are the biggest threats.

According to MAS and MTI, external macroeconomic conditions have stabilised since late last year, and global economic growth is expected to improve gradually this year.

In the US, the economy is expected to grow modestly, with resilient private demand helping to cushion the impact of fiscal cutbacks. The Eurozone is expected to remain in recession amidst record high unemployment and weak domestic demand. In Asia, growth is likely to be moderate, supported by healthy domestic demand.

Although Singapore’s economic growth eased in the first quarter, it is expected to improve gradually over the course of the year.

Externally-oriented sectors are expected to pick up in tandem with the gradual recovery in external demand, while construction and key services sectors such as finance & insurance and business services will continue to provide support to growth.

Nonetheless, risks to the global growth outlook remain. Fiscal uncertainties in the US remain with the failure of Congress to raise the debt ceiling, while the Eurozone is prone to a potential flare-up of the sovereign debt crisis.

Other uncertainties include the risk of an escalation in regional geopolitical tensions, and a possible global outbreak of respiratory viruses. Barring downside risks, the Singapore economy is expected to grow by 1.0 to 3.0 per cent in 2013.