SG Economy May Contract by Record 9% as Exports Collapse
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Singapore Economy May Contract by Record 9% as Exports Collapse
April 14 (Bloomberg) -- Singapore said its economy may shrink as much as 9 percent this year, the most since independence in 1965, as a deepening global recession drives down exports and manufacturing.
The economy may contract 6 percent to 9 percent, the trade ministry said in a statement today, reducing its forecast for the third time this year. The government previously predicted a decline of as much as 5 percent.
The central bank said it would adjust the trading range for the Singapore dollar, effectively lowering the band for the first time since 2003 to revive growth. Exports tumbled for an 11th month amid a slump that’s forced Chartered Semiconductor Manufacturing Ltd. to fire workers and the government to reduce taxes and subsidize jobs.
“The situation is really dire and the central bank’s policy will improve sentiment and help the economy,” said Vishnu Varathan, an economist at Forecast Singapore Pte. The policy move “gives them the flexibility to weaken the currency now, and steer it to strengthen when things get better.”
The worst global slump since World War II has pushed Asia’s trade-dependent nations into their deepest slowdown in more than a decade. Thailand’s economy may suffer a bigger contraction in 2009 than the 3 percent decline initially forecast after anti- government protests led to a state of emergency in Bangkok, Finance Minister Korn Chatikavanij said today.
The Monetary Authority of Singapore, which uses the exchange rate to manage price stability, said the local dollar had been trading at the lower end of its target range since October. The band will now be “re-centered” to reflect recent levels, it said.
Effective Devaluation
“The re-centering effectively translates to roughly a 1.7 percent devaluation of the Singapore dollar on a trade-weighted basis,” said Wai Ho Leong, a regional economist at Barclays Capital in Singapore. That would be the first effective lowering of the currency band since July 2003, he said.
Southeast Asia’s worst-performing currency this year rose 1.1 percent today after the central bank said there’s no reason for an “undue weakening.” Singapore stopped favoring gains in the local dollar in October and the central bank said today it will continue to seek neither appreciation nor depreciation.
Inflation will continue to ease in the coming months on cheaper commodities and a weakening economy, the authority said, reiterating a forecast that consumer prices will fall as much as 1 percent or remain unchanged this year.
Forecasts Cut
Singapore’s gross domestic product declined an annualized 19.7 percent last quarter from the previous three months, the trade ministry said today. The contraction was more than double the 9.6 percent drop predicted in a Bloomberg survey, and the biggest since at least 1975.
DBS Group Holdings Ltd. and United Overseas Bank Ltd. lowered their Singapore GDP forecasts today. DBS predicts the economy will shrink 7.7 percent this year, from an earlier forecast of a 4.8 percent contraction, while United Overseas expects a slide of 7.5 percent.
“The global economy is expected to remain weak in the coming quarters,” the trade ministry said today. “While there are tentative signs of some stabilization in the housing, financial and manufacturing sectors in the U.S., they do not point to a clear turnaround in economic activity.”
Singapore’s efforts to prevent job losses by handing out cash to companies haven’t stopped Chartered Semiconductor, music-player maker Creative Technology Ltd. and Swiss lender UBS AG from firing workers.
Job Losses
Companies probably fired more than 10,000 workers in the first three months of 2009, the Straits Times cited Prime Minister Lee Hsien Loong as saying last week. Singapore Airlines Ltd. has frozen pay and asked employees to take unpaid leave, and publisher Singapore Press Holdings Ltd. has cut wages.
UBS, Switzerland’s largest bank, said today it will eliminate 100 jobs in Singapore as it cuts about 240 positions from its wealth management division in the Asia-Pacific. Growth in financial services in Singapore slowed every quarter last year, and fell 8.1 percent in the final three months.
“The recession is very real and we have been bracing ourselves for a slowdown in demand,” said Dhrubajyoti Das, executive director of Singapore-based Samudera Shipping Line Ltd. “We will remain open to the possibility of capacity rationalization.”
Exports fell 17 percent in March from a year earlier, the trade promotion agency said today. Overseas shipments may drop as much as 13 percent in 2009, the government said, revising a previous estimate for a decline of 9 percent to 11 percent.
“Visibility remains fairly poor,” said Chong Chow Pin, senior director for corporate development at United Test Assembly Center Ltd., a Singapore-based semiconductor assembler and packager. “It’s too early to say if the semiconductor industry is out of the woods but the first quarter appears to be the bottom. Of course, no one can be certain.”
Singapore’s $161 billion economy contracted 11.5 percent last quarter from a year earlier. Manufacturing, which accounts for a quarter of the economy, fell 29 percent. Services shrank 5.9 percent while construction gained 25.6 percent.
http://www.bloomberg.com/apps/news?pid=20601080
Singapore devalues its fading dollar
A sharp decline in Singapore's economy in the first three months of the year has triggered a de facto devaluation of the Asian country's currency.
By Nic Fildes
In the three months to the end of March Singapore's gross domestic product fell nearly 20pc compared with the previous quarter, a result that proved much worse than most economists had forecast and was the largest quarterly decline on record. Compared with the same quarter a year earlier, Singapore's economy has shrunk 11.5pc.
As a result of the "sharp deterioration" in GDP, the trade ministry warned that the Singapore economy may contract by up to 9pc this year compared with its previous forecast of a potential decline of between 2pc and 5pc.
The fall was driven by an eleventh straight month of export declines, with non-oil domestic exports down 17pc in March. The export-led economy has been hit by a collapse in global consumer confidence, particularly in Europe and the US, and a loss of trade to regional rivals. That had a knock-on effect to other parts of the economy with manufacturing down 29pc in the first quarter.
The trade ministry said it expects the manufacturing sector to remain weak during 2009 despite the Singapore government's £8.6bn stimulus package announced earlier this year.
The Monetary Authority of Singapore moved to reflect the poor economic data by effectively devaluing the local currency by lowering the trading band in which it is managed. The move, which echoes the action taken in previous downturns in 2002 and 2003, devalues the currency by around 2pc according to economists.
Yet the re-rating of the currency was deemed to be far less aggressive than had been expected and positive comments from Singapore's central bank strengthened confidence in the local currency which has lost nearly 10pc of its value against the US dollar over the past year.
The Singapore central bank said that it could see no reason for "any undue weakening" of the Singapore dollar which implied it does not plan to devalue the currency further. "The Singapore economy continues to be anchored by sound fundamentals and a resilient financial system," the government body said in a statement. It described the devaluation as a "one-off".
The exchange rate band is Singapore's key monetary device. The Monetary Authority of Singapore does not disclose the limits of the trading range.
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Dun worry Uncle, MIT and MAS will re adjust singapore growth forecast shortly, meantime, have a cup of green tea. Relax hor. Adjusting is very easy only.
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Singapore's Sinking Economy Over-Dependent on Exports
By Chosun Ilbo columnist Lee June
On his first trip to the United States in 1967, former Singapore Prime Minister Lee Kuan Yew attended a lunch gathering in Chicago hosted by American businessmen. One participant asked Lee how Singapore, once just a small fishing village, became a metropolis that houses two million residents. Lee offered a clear explanation: Singapore manufactured products that were the cheapest in the world, yet were of top quality. He said if Singapore was unable to do that, it would not survive. Word spread throughout corporate America: "Keep your eyes on Singapore."
When Lee was inaugurated as prime minister in 1959, Singapore's per-capita Gross National Income (GNI) was just US$400. The landscape was so barren that Singapore had to purchase even tap water from its neighboring countries. Singapore's economy, which had depended on its colonial ruler England for 80 percent of its support and trade, fell into panic after British troops pulled out in the mid-1960s. Trade with neighboring Indonesia and Malaysia also dropped sharply. Singapore resorted to opening its markets and attempting to boost exports in order to survive.
In just 20 years, Singapore grew to become the largest trading hub in Southeast Asia. Its strategy of nurturing exporters by cooperating with multinational companies paid off. Singapore became a link between Southeast Asia and the world, where multinational businesses dropped off products to be exported to Southeast Asia, while products manufactured in Southeast Asia converged in Singapore to be exported worldwide.Singapore is now an export giant that ships out products worth double its gross domestic product (GDP). Around 5,000 foreign businesses and 220 multinational corporations have their Asia-Pacific headquarters in Singapore, whose total land mass is slightly larger than Seoul
Singapore's economy contracted 11.5 percent during the first quarter of this year, compared to a year ago. Exports are also down 20 - 30 percent so far this year. Changi Airport, where 63 carriers provide flights to 139 cities around the world, and the port of Singapore, which handles cargo headed to 600 ports in 123 countries, are quieter. According to some projections, Singapore's economy could shrink between six to eight percent this year.
Singapore emerged relatively undamaged from the 1997 Asian financial crisis, which impacted more severely in Korea and other countries in the region. At that time, Lee boasted that Singapore was still the leader of Asian values and the Asian manufacturing model.But he probably has little to say this time.
The Financial Times reported that the economy of Singapore was sinking as exports drop rapidly. This is the problem with depending wholly on exports without the support of domestic demand. It is also a problem facing Korea.
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Originally posted by Ah Chia:
Singapore's Sinking Economy Over-Dependent on Exports
By Chosun Ilbo columnist Lee June
On his first trip to the United States in 1967, former Singapore Prime Minister Lee Kuan Yew attended a lunch gathering in Chicago hosted by American businessmen. One participant asked Lee how Singapore, once just a small fishing village, became a metropolis that houses two million residents. Lee offered a clear explanation: Singapore manufactured products that were the cheapest in the world, yet were of top quality. He said if Singapore was unable to do that, it would not survive. Word spread throughout corporate America: "Keep your eyes on Singapore."
When Lee was inaugurated as prime minister in 1959, Singapore's per-capita Gross National Income (GNI) was just US$400. The landscape was so barren that Singapore had to purchase even tap water from its neighboring countries. Singapore's economy, which had depended on its colonial ruler England for 80 percent of its support and trade, fell into panic after British troops pulled out in the mid-1960s. Trade with neighboring Indonesia and Malaysia also dropped sharply. Singapore resorted to opening its markets and attempting to boost exports in order to survive.
In just 20 years, Singapore grew to become the largest trading hub in Southeast Asia. Its strategy of nurturing exporters by cooperating with multinational companies paid off. Singapore became a link between Southeast Asia and the world, where multinational businesses dropped off products to be exported to Southeast Asia, while products manufactured in Southeast Asia converged in Singapore to be exported worldwide.Singapore is now an export giant that ships out products worth double its gross domestic product (GDP). Around 5,000 foreign businesses and 220 multinational corporations have their Asia-Pacific headquarters in Singapore, whose total land mass is slightly larger than Seoul
Singapore's economy contracted 11.5 percent during the first quarter of this year, compared to a year ago. Exports are also down 20 - 30 percent so far this year. Changi Airport, where 63 carriers provide flights to 139 cities around the world, and the port of Singapore, which handles cargo headed to 600 ports in 123 countries, are quieter. According to some projections, Singapore's economy could shrink between six to eight percent this year.
Singapore emerged relatively undamaged from the 1997 Asian financial crisis, which impacted more severely in Korea and other countries in the region. At that time, Lee boasted that Singapore was still the leader of Asian values and the Asian manufacturing model.But he probably has little to say this time.
The Financial Times reported that the economy of Singapore was sinking as exports drop rapidly. This is the problem with depending wholly on exports without the support of domestic demand. It is also a problem facing Korea.
Uncle, you want some biscuit?? -
Singapore Economy in Free Fall Disaster
Source: The Huffington Post, 18 April 2009
The city state of Singapore, Venice of the 21st century in terms of its mercantile prowess, has as its national anthem the refrain, “Onward, Singapore.” With the data that has recently emerged on the Q1 performance of Singapore’s economy, however, it may be time to change the national anthem to “Backwards, Singapore.” The numbers are that bad.
This tiny Island republic, sitting at the tip of the Malay Peninsula, covers only 274 square miles, with a population of under five million. Yet through innovation, industriousness and the entrepreneurial environment facilitated by a pro-business if somewhat authoritarian government, Singapore has become a powerhouse within the global economy. Indeed, no less an authority than the World Bank has graded Singapore as the most business friendly economy in the world. However, amidst the tectonic shifts occurring as a result of the Global Economic Crisis, Singapore has discovered that it is an exceptionally vulnerable and fragile geopolitical space.
Global trade is the engine that drives the Singapore economy. The tiny nation has a vast manufacturing sector, which includes electronics, petrochemicals and engineering. With its small population, Singapore must export the products it manufactures. That export trade has led Singapore to being the fourth largest port in the world. The Global Economic Crisis, however, has sent international trade into a tailspin. All major exporters are hurting badly; Singapore is bleeding.
In the first quarter of 2009, Singapore’s GDP contracted at a catastrophic rate of 11.5%, much worse than expected. In March, non-petroleum exports declined by 17%, the eleventh consecutive monthly decline. Unemployment is rising while business confidence is plummeting. The once busy port of Singapore is now almost quiescent, a reflection not only of Singapore’s decline but also a window on how severely global trade has been impacted by the worldwide recession.
As in America and other major economies that have been decimated by the Global Economic Crisis, Singapore has its share of overly optimistic economists, analysts and media pundits who are trying to spin the bad news into glimmers of hope. Some have even suggested that the severity of the country’s Q1 economic statistics are “proof” that the recession has hit bottom and will soon begin to ease.
However, such appalling macroeconomic data cannot wear a happy face under any circumstance; it is irrefutable proof that the synchronized global recession now shattering the worldwide economy is unprecedented in its depth and reach. I think the elder statesman of Singapore, former Prime Minister Lee Kuan Yew, was more aligned with reality when he recently suggested that it will take at least six years before Singapore recovers from the effects of the Global Economic Crisis.
Amid all the horrific economic news, Singapore can boast of an advantage denied the deficit-driven economies of Europe and the United States. During the good times, the Island nation prudently set aside substantial foreign exchange reserves. Even with a recent $20 billion stimulus package, Singapore still maintains a reserve fund of $170 billion.
This will provide flexibility for policymakers to address the immediate ramifications of the severe economic contraction now occurring in their country. Nevertheless, there can be no doubt that once prosperous Singapore is facing many years of economic and financial hardship that will severely test the country’s capacity for entrepreneurial innovation and hard work.
If a nation that has been as prudent and fiscally responsible as Singapore is enduring a free fall meltdown in vital areas of its economy, what about the United States, which is also undergoing a significant economic contraction, but with a massive debt load instead of sizeable reserves?
http://www.sgpolitics.net/?p=2706
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Originally posted by Ah Chia:
Singapore Economy in Free Fall Disaster
Source: The Huffington Post, 18 April 2009
The city state of Singapore, Venice of the 21st century in terms of its mercantile prowess, has as its national anthem the refrain, “Onward, Singapore.” With the data that has recently emerged on the Q1 performance of Singapore’s economy, however, it may be time to change the national anthem to “Backwards, Singapore.” The numbers are that bad.
This tiny Island republic, sitting at the tip of the Malay Peninsula, covers only 274 square miles, with a population of under five million. Yet through innovation, industriousness and the entrepreneurial environment facilitated by a pro-business if somewhat authoritarian government, Singapore has become a powerhouse within the global economy. Indeed, no less an authority than the World Bank has graded Singapore as the most business friendly economy in the world. However, amidst the tectonic shifts occurring as a result of the Global Economic Crisis, Singapore has discovered that it is an exceptionally vulnerable and fragile geopolitical space.
Global trade is the engine that drives the Singapore economy. The tiny nation has a vast manufacturing sector, which includes electronics, petrochemicals and engineering. With its small population, Singapore must export the products it manufactures. That export trade has led Singapore to being the fourth largest port in the world. The Global Economic Crisis, however, has sent international trade into a tailspin. All major exporters are hurting badly; Singapore is bleeding.
In the first quarter of 2009, Singapore’s GDP contracted at a catastrophic rate of 11.5%, much worse than expected. In March, non-petroleum exports declined by 17%, the eleventh consecutive monthly decline. Unemployment is rising while business confidence is plummeting. The once busy port of Singapore is now almost quiescent, a reflection not only of Singapore’s decline but also a window on how severely global trade has been impacted by the worldwide recession.
As in America and other major economies that have been decimated by the Global Economic Crisis, Singapore has its share of overly optimistic economists, analysts and media pundits who are trying to spin the bad news into glimmers of hope. Some have even suggested that the severity of the country’s Q1 economic statistics are “proof” that the recession has hit bottom and will soon begin to ease.
However, such appalling macroeconomic data cannot wear a happy face under any circumstance; it is irrefutable proof that the synchronized global recession now shattering the worldwide economy is unprecedented in its depth and reach. I think the elder statesman of Singapore, former Prime Minister Lee Kuan Yew, was more aligned with reality when he recently suggested that it will take at least six years before Singapore recovers from the effects of the Global Economic Crisis.
Amid all the horrific economic news, Singapore can boast of an advantage denied the deficit-driven economies of Europe and the United States. During the good times, the Island nation prudently set aside substantial foreign exchange reserves. Even with a recent $20 billion stimulus package, Singapore still maintains a reserve fund of $170 billion.
This will provide flexibility for policymakers to address the immediate ramifications of the severe economic contraction now occurring in their country. Nevertheless, there can be no doubt that once prosperous Singapore is facing many years of economic and financial hardship that will severely test the country’s capacity for entrepreneurial innovation and hard work.
If a nation that has been as prudent and fiscally responsible as Singapore is enduring a free fall meltdown in vital areas of its economy, what about the United States, which is also undergoing a significant economic contraction, but with a massive debt load instead of sizeable reserves?
http://www.sgpolitics.net/?p=2706
Uncle Chia, u want some girls? -
Straits Times: Economy not as bad as it looks
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Is this the place where people dump random news links?
Asian currencies gain against dollar
Fitch maintains Singapore's AAA rating
HONG KONG, CHINA, April 17 (Reuters) - Fitch Ratings affirmed the top rating for Singapore, highlighting its strong external and public finances, stable politics and flexible state policies, but also warned about its vulnerability to external shocks.
Fitch retained the AAA rating but said the city-state was exposed because it had a small and open economy with most of its trading partners being advanced economies.
The agency said Singapore's economy would shrink by 12.6 percent in the current year, adding the government's stimulus measures to support the economy enjoyed a high degree of flexibility because of continuous fiscal surpluses, sizable government reserves and zero fiscal-related government debt.
http://business.asiaone.com/Business/News/My%2BMoney/Story/A1Story20090417-135867.html
Obama dog Bo should be a hard worker, full personality
http://blog.nola.com/chrisbynum/2009/04/obama_dog_bo_should_be_a_hard.html
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Economy where got bad? did our gahmen lose sleep over it?
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Originally posted by seyKai:
Economy where got bad? did our gahmen lose sleep over it?
yup, they didn't. all the reports about statement and countermeasures of the govt is an illusion. never happened.
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if economy is that bad, where r they still paying themself such absurd salaries?
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Hey, they already cut their salaries to 3 million already.
What more you want?
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Haiz.............................
9% gdp contraction means 5%-6% unemployment.
it's human nature to be greedy, if you set your own salary with unlimited access to funds, how much would you pay yourself.
you will never be able to satisy a greedy man.
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got retrenchment or not for a lousy job done. still can get high salary ar?
many ppl oredi suffering leh
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Originally posted by seyKai:
if economy is that bad, where r they still paying themself such absurd salaries?
they did cut their salary. you can start a petition to ask them to work for free though.
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Originally posted by seyKai:
got retrenchment or not for a lousy job done. still can get high salary ar?
many ppl oredi suffering leh
you can decide how lousy they do their job at the election poll.
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Paraguay's president donates his entire salary to the poor
http://observers.france24.com/en/content/20080828
Paraguay: President Lugo to Forgo Salary
Fernando Lugo's presidency started with an announcement that he would forgo his monthly salary. “I don't need that salary, which belongs to the poor,” said Lugo.
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If he honorable and not so greedy for public money, persecuting opposition and activist, do you think he will be so cursed until his wife becomes a zombie and his son gets cancer of the anus.... and so on and so forth?
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The only smart thing to do when cursed despots destroy the economy, is?
Originally posted by AndrewPKYap:Edited on Friday April 17 2009
The economy is getting worse!!!!!! The IR will benefit foreigners while Singaporeans suffer from having casinos round the corner.
Prices are still up there!!!!
It will not get better until prices come down much more, before the economy can start to recover. Otherwise it will be "not starve to death but you cannot fill your stomach"
Time to send the emails again!!!!! Send this email:
Hi
see what I found on the internet:
Dear Friend
The situation in Singapore is getting worse. Join the rest of Singapore and stop spending your money!!! Hoard it or save it or invest it but stop spending money, stop buying unless absolutely necessary.
Defer purchases if you can for the prices will come down given that the economy is in such dire straits.
It is so bad and getting worse because of government policy mistakes and the lack of economic contingency planning.
The jobs in the IR are going to foreigners. Singaporeans suffer from having casinos at their doorsteps but the benefits are going to foreigners! A double blow for the country.
5,000 jobs available in Singapore (for Philipinos presently in the Philipines)
MANILA, Philippines - President Arroyo announced yesterday that around 5,000 new jobs would be made available to Filipinos in the island resort of Sentosa in Singapore.
Speaking before the Federation of Filipino-Chinese Chambers of Commerce and Industry Inc. at the SMX Convention Center in Pasay City, Mrs. Arroyo said Labor Secretary Marianito Roque was able to get openings in Sentosa for 5,000 jobs.”http://www.manilastandardtoday.com/?page=politics4_april4_2009
RegardsAndrew Yap
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between the greed and morality dichotomy, it's very clear which side of the spectrum our leaders chose.
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Bolivia leader halves his own pay
The Bolivian new left-wing President, Evo Morales, has cut his salary by more than a half to a little over $1,800 (£1,012) per month.
The decision means that the salaries of all Bolivian public sector employees will be reviewed, as no official can earn more than the president.
Mr Morales said the money saved would be used to increase the numbers of doctors and teachers... -
Let them take until their grandchildren suffer from cancer before they die... this universe is very fair... you support evil, even if the evil is your father or grandfather or you dog handler... the curses fall on you... it is a no-brainer.
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Economy in free fall huh, how come singapore is awash with foreigners lar, it boggles the mind, oops, i forgot lar - cheap labour, cleverly disguised as talent, singapore number one in so many things, but singaporeans not clever enough for filling up jobs, so-called foreign talent need to nourish our sagging souls and econcomy, need i say more,
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Singapore No.1 in "foreign talents" displacing citizens for jobs.
Who says we aren't No.1 even in an economic downturn?
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I noticed that during this recession, population was reported to have increased to just under 5 million.
Go figure.