Singapore maintains its forecast for real gross domestic product (GDP) growth in 2024 at 1-3% as the economy grew by 2.7% year-over-year in the first quarter of 2024, according to CNA.
The growth in the first quarter was in line with the upgraded estimate by the Ministry of Trade and Industry (MTI) and higher than the 2.2% growth recorded in the final quarter of 2023.
The 2.7% expansion beat the 2.5% forecast by economists in a Reuters poll. It was also the best growth performance in 18 months since the city-state’s economy grew by 4.1% year-over-year in Q3 2022.
MTI said on Thursday (May 23) that the Q1 2024 GDP growth was mainly driven by the finance and insurance, transportation and storage, and wholesale trade sectors.
In the finance and insurance sector, a surge in trading volumes for most asset classes, improved credit intermediation activity, and solid growth in the insurance and auxiliary activities sub-segment led to a 6.5% year-over-year expansion, up from the 5.4% growth in the previous quarter.
Transportation and storage were key drivers of Singapore’s economic growth in Q1 2024.
The transportation and storage sector grew by 6.8% year-over-year, up from 2.8% in Q4 2023. This was attributed to strong growth in the air transport segment, with total air passenger traffic handled at Changi Airport in the quarter surpassing pre-COVID levels.
Meanwhile, the water transport segment also expanded due to an increase in container and cargo throughput handled at Singapore’s ports.
The wholesale trade sector grew by 1.5% year-over-year, up from the 0.2% growth in the previous quarter.
The petroleum and chemicals segment saw higher output in both the petroleum and petroleum products, as well as the chemicals and chemical products sub-segments. The other chemicals segment, which includes a diverse range of products such as metals, wood and construction materials, household equipment, and furniture, also contributed to the growth.
Vietnam’s Economy: Projected to Grow by 6% in 2024
According to statistics from the General Statistics Office, Vietnam’s GDP growth in Q1 2024 reached 5.66%. This figure is close to UOB’s forecast of 5.5% and is the highest first-quarter growth in the last four years.
The International Monetary Fund’s (IMF) World Economic Outlook report predicts that a series of developing countries will achieve the highest growth rates until 2029.
Vietnam is among the top developing countries with the highest projected growth rates in the world until 2029.
Vietnam is the only Southeast Asian country in the top 10, with a projected growth rate of 6.4% from 2024 to 2029.
The IMF forecasts a strong economic growth phase for Vietnam, making it one of the fastest-growing emerging economies. This is expected to open up significant opportunities for the country in attracting foreign investment and boosting economic development in the region and globally.
In a recently published macroeconomic report on Vietnam, Standard Chartered has forecast a GDP growth rate of 6% for 2024, down from its previous forecast of 6.7% due to lower-than-expected Q1 2024 growth and challenges in global trade.
However, this projection is still considered an improvement over the 5.0% growth recorded in 2023. Q1 2024 GDP growth slowed to 5.7% (from 6.7% in Q4 2023).
Standard Chartered also revised down its growth forecast for Q2 2024 to 5.3% (from 6.3%) and Q3 2024 to 6.0% (from 7.2%). But Q4 2024 growth is expected to rebound to 6.7%.
