Asia’s macroeconomic conditions are expected to see supportive growth next year, said the Ministry of Trade and Industry.
The advanced economies will continue to grow albeit at a slower pace, and the rebound in business investment will continue to pick up, fuelled by accommodative monetary policies.
However, the MTI cautioned that while household demand will continue to grow, the strength of the recovery could be hindered by weak household balance sheets and high jobless rates.
MTI also expects domestic demand in Asia to remain robust, supported by wage growth, healthy fundamentals and encouraging government policies.
“This will drive intra-regional trade in goods and services, such as travel and finance,” said MTI in a statement. “In addition to the expected boost in external demand, economic activities in Singapore will also increase on account of new capacity additions in the manufacturing sector and progressive offerings of recreational facilities in the tourism-related services industries.”
“Nevertheless, the global economy remains vulnerable to several downside risks, notably a reversion to recessionary conditions in the US, and concerns of sovereign debt sustainability in the peripheral EU economies.”
It expects that Singapore will likely see an economic growth of between 4 percent and 6 percent next year.