18 November 2002 05:15 [Source: ICIS news]
SINGAPORE (CNI)--Singapore has revised downwards its 2002 growth forecast to 2-2.5% from its earlier 3-4% estimate even though the chemicals industry continued to perform well in the third quarter of the year, albeit at a more moderate rate of 40%, the Ministry of Trade and Industry said on Monday.
The ministry said the Singapore economy had grown by 3.9% in Q3 2002. However, growth momentum on an annualised quarter-by-quarter basis went down by 10.1% after increasing by 13.4% in the second quarter this year.
The ministry forecast further gloom ahead with the growth forecast for 2003 being pegged at 2-5%. A weak external environment, with the US economy - the main driver of global growth - appeared to lose momentum, it said.
US consumer confidence, the pillar of the US recovery to date, appeared to be petering out, with confidence dropping to a nine-year low in October, the ministry said.
This was due to the weak labour market, prospects of war with Iraq and the protracted decline in the stock market.
The ministry said the recovery in the global electronics industry was expected to soften in Q4 this year and H1 of next year, with analysts slashing their 2003 growth forecasts for global semiconductor sales to 12% from earlier projections of 22%.
Other than the chemicals industry, the electronics industry was the only other Singapore sector to show double digit growth in Q3 - of 15%.
The outlook for the fourth quarter and next year was subject to even greater uncertainties, the ministry said.
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