Singapore’s GDP growth decelerated to 2.9% in the third quarter, down from 4.5% in Q2, as trade momentum waned, according to Market Analyst Zavier Wong from eToro. The economy expanded by 1.3% on a quarter-on-quarter basis. This slowdown reflects a broader global economic shift, with Singapore’s Prime Minister Lawrence Wong describing the world as “fractured, uncertain, and disrupted.”
The latest data highlights a stagnation in manufacturing, a softening in construction, and a decline in wholesale trade, attributed to the diminishing impact of export front-loading earlier in the year. As the US increases tariffs and China limits rare-earth exports, Singapore, which relies heavily on both nations, must navigate these changing trade dynamics. Despite these challenges, the services sector showed resilience, growing by 3.5%, indicating a shift towards services-driven growth.
Wong suggests that investors should interpret the GDP figures not as a mere slowdown but as a signal of a more volatile external economic cycle, marked by retaliation rather than recovery. Singapore’s future growth will depend on the robustness of its service sectors and institutional credibility. The Monetary Authority of Singapore (MAS) has opted to maintain its current policy stance, prioritising stability over tightening, given the moderated growth and contained inflation. Wong emphasises that Singapore’s best strategy in a divided world is to remain open whilst others build barriers.
