Gross domestic product (GDP) growth in Singapore could slow to 6.7 percent in the second quarter, according to leading indicators of the recent BT-UniSIM Business Climate Survey.
Based on contraction in exports and manufacturing in April, Survey Director Chow Kit Boey believes that Q2 GDP growth could be at the lower end of the projected range of 6.7 percent to 7.4 percent.
In its 17th year, the quarterly poll tracks indicators such as the company’s orders, sales and profit performance, as well as business prospects.
Ms. Chow said the regression analyses of survey data showed that Q2 witnessed an even lower rate of growth, marking a second quarter of slowdown.
Singapore’s economy grew 8.3 percent year-on-year in Q1, slowing from the 12 percent growth in Q4 2010, according to the Ministry of Trade and Industry (MTI).
The 143 companies polled in April collectively pointed to a major weakening of business transactions in Q1, with profits identified as the hardest hit among the three monitored activity indicators.
Ms. Chow said small companies revealed a poorer showing in the previous quarter, adding that they are “the least resilient in a turbulent adverse environment.”
Most companies reported lower profits in Q1 than they had collected last year, pushing the profit net balance 10 points lower to negative eight percent.
In terms of profits, sales performance was also weaker “irrespective of size and ownership of firms” in Q1. The total net balance for sales slipped four points to 13 percent.
Also, orders slowed down year-on-year, with the net balance dropping nine points from Q4 to 13 percent.
Of the various economic sectors covered by the survey, business and financial services once again emerged as the “star performer” for the seventh consecutive quarter.
According to the survey, business and financial services comprised the largest portion of companies posting growth in sales, profits and positive business prospects.
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