Singapore’s Ministry of Trade and Industry (MTI) has revised the country’s GDP growth forecast for 2025 to approximately 4.0%, up from the previous estimate of 1.5% to 2.5%. This adjustment follows a robust performance in the third quarter of 2025, where the economy grew by 4.2% year-on-year. The growth was primarily driven by the manufacturing, wholesale trade, and finance and insurance sectors, with significant contributions from the electronics and biomedical manufacturing clusters.
The electronics cluster saw a 6.1% increase, largely due to heightened demand for AI-related semiconductors and server products. Meanwhile, the biomedical manufacturing sector expanded by 8.9%, buoyed by the production of high-value pharmaceutical ingredients. The wholesale trade sector benefited from strong global demand for AI-related electronics, whilst the finance and insurance sector was bolstered by improved business and investor sentiment.
Looking ahead to 2026, MTI projects GDP growth to range between 1.0% and 3.0%. This forecast considers potential challenges such as the impact of US tariffs, which could affect key trading partners like China and the Eurozone. Despite these challenges, sectors such as electronics and transport engineering are expected to continue supporting Singapore’s economic growth.
The revised forecast reflects Singapore’s resilience amidst global economic uncertainties, with the AI boom and easing trade tensions contributing to the positive outlook. However, MTI cautions that global economic risks remain, which could influence future growth trajectories.
