• 화요일, 10월 04일
화요일, 10월 04일

Singapore's falls into the worst recession in a decade

Singapore's falls into the worst recession in a decade

Picture=Wikipedia

[Newsphopick=Kingsley Lim] According to official data sources, Singapore’s virus-ravaged economy has been one of the hardest-hit countries in the world as the economy contracted by 43 percent in the second quarter of the year. This is the first recession that the country is experiencing in a decade – worse than initially anticipated by economists.

Singapore, which is highly dependent on tourism and global trade, had to take tough measures to curb the spread of the coronavirus. Government-led efforts have put in place social restrictions and lockdowns, which caused general business activity to fall significantly. 

According to the trade ministry, it initially estimated that there will be a 41.2 percent decline in the gross domestic product based on two months of data. These estimates however, have proven to be conservative as Singapore’s gross domestic product fell by 42.9 percent from the first quarter. >Initial estimates suggested a 12.6% contraction in the second quarter. However, Singapore’s economy contracted by 13.2 percent in the April-June quarter. 

Since there are were two quarters of consecutive contraction, Singapore has technically entered into the first recession since the Great Financial Crisis in 2009. 

Singapore was one of the first countries in the region to report growth data during a period where its surrounding neighbours had gone into a full-fledged lockdown. Since Singapore is highly dependent on trade, the statistical data coming out of the city state is particularly indicative of things to come. 

These alarming figures which are worse than estimated, is predictive of the fate of many Asian countries which are dependent on trade. According to market observers, Singapore is usually the first to be hit – and this ripples to other countries in the region. >The road to economic recovery remains uncertain. The government estimates that the economy will contract by 5.0 to 7.0 percent for the year, worse than its previous forecast of 4.0 to 7.0 percent. "Many of Singapore's key final demand markets saw worse-than- projected economic disruptions in the second quarter," said the trade ministry. 

It added that these markets "are also expected to experience a more gradual pace of recovery in the second half of 2020 due to the threat of localized outbreaks and the continued need for restriction measures to contain such outbreaks as they occur." 

The Prime Minister, Lee Hsien Loong, warned Singaporeans in a National Day message that “the crisis is far from over”. While many countries have attempted to contain the spread of the virus by promulgating mandatory lockdowns and other social restrictions, virus numbers remain stubbornly high. In some instances, certain countries are seeing another surge of infections which point to a possible second wave. 

Singapore’s tough measures include contact-tracing and heavy testing amongst its population. While this initially showed some success in curbing the spread of the virus, low-paid migrant worker populations living in cramped dormitories were badly hit by several outbreaks. However, community infections remain low. So far, the country has reported 55,000 infections and 27 deaths.

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Singapore's falls into the worst recession in a decade

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