Virus-hit Singapore Plunges Into Recession As Economy Shrinks 41%
Mohammad Ali (@ChaudhryMAli88) Published July 14, 2020 | 09:00 AM
Singapore, (UrduPoint / Pakistan Point News - 14th Jul, 2020 ) :Singapore plunged into recession in the second quarter as the economy contracted more than 40 percent, preliminary data showed Tuesday, with the trade-dependent city state hammered by the coronavirus in another ominous sign for the global recovery.
The economy shrank 41.2 percent quarter-on-quarter and 12.6 percent on-year between April and June, according to data from the trade ministry, and analysts said it was the worst quarterly figure for gross domestic product ever recorded in Singapore.
It marked the second consecutive quarter of contraction, meaning the city state has entered a recession for the first time since 2009, when it was hard hit during the global financial crisis.
Singapore is one of the world's most open economies and is seen as a barometer for the health of global trade, and the dismal figures are another warning sign that the global economy is heading for a deep and painful downturn.
The worse-than-expected figures will also ring alarm bells for Asia's many trade-dependent economies -- typically, Singapore is hit first before ripples spread across the region.
"It's the worst-ever quarterly figure in Singapore's 55-year history," CIMB Private Banking regional economist Song Seng Wun told AFP.
"But it's not a surprise as the bottom line is that Singapore is a small city state, extremely dependent on trade in goods and services." The trade ministry said the massive contraction was due to restrictions imposed from early April to early June to stem the spread of the virus, which included the closure of many businesses.
It also attributed the shrinkage to weak external demand.
- 'The trough' - The construction sector contracted by 54.
7 percent year-on-year and 95.6 percent compared to the previous quarter, the figures showed.
The services sector shrank 13.6 percent year-on-year, with tourism-related services and the air transport sector hard hit due to travel restrictions.
The manufacturing sector, however, expanded by 2.5 percent on-year in the second quarter, primarily due to a surge in output in biomedical manufacturing, the ministry said.
The data released Tuesday are based on so-called "advance estimates". The figures are often revised once the full quarter's data are available.
Singapore initially kept its virus outbreak in check through a strict regime of testing and contact-tracing, only for serious outbreaks to later sweep through crowded dormitories housing low-paid migrant workers.
It has reported more than 46,000 infections, including 26 deaths.
The long-ruling People's Action Party saw its support slip at a general election last week, although it still comfortably retained power, amid concerns about job security and the economy during the pandemic.
The affluent country's government has already rolled out about Sg$100 billion (US$72 billion) in stimulus packages, but the poor data could pile pressure on leaders to do more.
However, research consultancy Capital Economics said in a note that the second-quarter data will "mark the trough" in the downturn, and that Singapore was slowly emerging from its partial lockdown.
"Domestic activity started to rebound once restrictions on work and leisure began to be eased at the start of June," it said.
"And while many industries, notably tourism and hospitality, will continue to suffer, the economy should rebound faster than others in the region."
Related Topics
Recent Stories
Malala expresses unwavering support for Gaza people
Selection committee dissolved over Pakistan women cricket team's poor performanc ..
Punjab CM Maryam Nawaz in police uniform at Chung police center
Currency Rate In Pakistan - Dollar, Euro, Pound, Riyal Rates On 25 April 2024
Today Gold Rate in Pakistan 25 April 2024
Mired in crisis, Boeing reports another loss
Session Awarding Ceremony 2024 held at Cadet College Muzaffarabad
Austrian ski great Hirscher to make comeback under Dutch flag
Pakistan, Japan agrees to convene 'Economic Policy Dialogue'
FM Dar conveys deepest sympathy on torrential rains devastation in UAE
Spain PM Sanchez says weighing resignation after wife's graft probe
Tennis: ATP/WTA Madrid Open results - 1st update
More Stories From Miscellaneous
-
PDMA predicts gusty wind, rain with thunder, hails
2 days ago -
Iranian president Raisi given guard of honour at PM House
3 days ago -
Intellectuals, writers accolades Naseer Mirza on his literary contribution
4 days ago -
Bahawalpur Adabi Sangat hosts memorable mushaira
4 days ago -
Cattle farming vital to alleviate poverty in rural areas
4 days ago -
Pakistan: A land of tourism, archeological wonders
4 days ago
-
Transforming education sector: from job hunters to job creators
6 days ago -
Amjad Bobby remembered on 19th death anniversary for timeless contributions to music
10 days ago -
Legendary actor Nadeem’s 26 films released on Eid-ul-Fitr days in 50 years
11 days ago -
Besant Hall Cultural Centre to celebrate evening with Sanam Marvi on 26 April
11 days ago -
Radio Bahawalpur presents program “Eidi Shidi”
14 days ago -
Radio Bahawalpur to broadcast Eid programs
16 days ago