Singapore’s gross domestic product expanded a seasonally adjusted 2.6 percent on quarter in the fourth quarter of 2021, the Ministry of Trade and Industry said on Monday.
That beat expectations for an increase of 2.0 percent on quarter following the 1.2 percent increase in the previous three months.
On an annualized yearly basis, GDP jumped 5.9 percent – also exceeding forecasts for a gain of 5.4 percent and slowing from 7.1 percent in the third quarter.
For all of 2021, GDP jumped 7.2 percent after shrinking 5.4 percent in 2020.
The manufacturing sector expanded 14.0 percent on year in the fourth quarter, faster than the 7.9 percent growth in the third quarter. Growth during the quarter was supported by output expansions in all clusters. In particular, the electronics and precision engineering clusters continued to record strong output growth, driven by sustained global demand for semiconductors and semiconductor equipment respectively. On a quarterly basis, the manufacturing sector expanded by 4.2 percent, an improvement from the 0.2 percent growth in the third quarter.
The construction sector grew 2.0 percent on year in the fourth quarter, slower than the 66.3 percent growth in the preceding quarter. In absolute terms, the value-added of the sector remained 26.0 percent below its pre-COVID (i.e., fourth quarter of 2019) level, as activity at construction worksites continued to be weighed down by labor shortages due to border restrictions on the entry of migrant workers. On quarter, the sector contracted by 4.4 percent in the fourth quarter, a reversal from the 4.9 percent growth in the previous quarter.
Among the services sectors, the wholesale & retail trade and transportation & storage sectors grew by 4.3 percent on year in the fourth quarter, extending the 6.1 percent growth in the third quarter. All sectors within the group expanded during the quarter. In particular, the wholesale trade sector posted steady growth in tandem with the robust performance of Singapore’s merchandise exports.
By contrast, growth in the transportation & storage sector was partly due to low base effects, as travel restrictions had weighed heavily on the air transport segment in the fourth quarter of last year. On the whole, the value-added of this group of sectors (i.e., wholesale & retail trade and transportation & storage) in the fourth quarter remained 2.3 percent below its pre-pandemic level. On a quarterly basis, the sectors grew by 2.3 percent in the fourth quarter, a turnaround from the 0.6 percent contraction in Q3.
The information & communications, finance & insurance and professional services sectors collectively expanded 6.0 percent on year in the fourth quarter, moderating from the 8.0 percent growth in the previous quarter. All sectors within the group recorded expansions. In particular, the information & communications sector continued to benefit from strong demand for IT and digital solutions as well as robust games & software publishing activities, while the finance & insurance sector was bolstered in part by fund management activities. On a quarterly basis, the sectors in the group posted growth of 3.1 percent in the fourth quarter, faster than the 1.5 percent expansion registered in the preceding quarter.
The remaining group of services sectors (i.e., accommodation & food services, real estate, administrative & support services and other services sectors) grew 3.1 percent on year in the fourth quarter, extending the 3.8 percent growth in the previous quarter. Within the group, all the sectors expanded except for the accommodation & food services sector. The weak performance of the accommodation & food services sector was primarily due to ongoing travel restrictions, as well as tighter domestic restrictions (e.g., group size limits for dining-in) during the quarter as compared to the same period in 2020. On the whole, the value-added of the sectors in the group (i.e., accommodation & food services, real estate, administrative & support services and other services sectors) remained 7.1 percent below its level in the fourth quarter of 2019. On a quarterly basis, these sectors expanded 4.9 percent in the fourth quarter, improving from the 1.5 percent growth in the preceding quarter.