The MTI has released its advance GDP estimates for the Singapore economy in Q1-2009.    The Singapore economy fell 11.5% in Q1-2009 compared to Q1-2008 and declined by an even sharper 19.7% quarter on quarter which is even worse than the 16.4% quarter on quarter contraction in Q4-2008.   Manufacturing contracted 29% and services fell 5.9% which were in part partially offset by a 25% rise in construction.   The MTI has as a result of this sharp growth decline lowered Singapore's GDP growth forecasts for 2009 has been lowered from -2% to -5% to now -6% to -9%.

Singapore Advance GDP estimates Year on Year

Advance GDP Estimates Quarter on Quarter

Q1-2009 is not the bottom as the quarter on quarter rate of decline seems to be expanding.   This is mainly due to the collapse in external demand and shows Singapore's vulnerability as an open export oriented economy.   What is comforting is that the rate of decline in GDP seems to be slowing as implied by the growth rate of -6% to -9% which is lower than the -11.5% in Q1-2009.   I think the economy is likely to bottom in Q4-2009 where it could return to positive GDP growth but like the US we could be looking at modest growth in 2010, ie depending on the Global economy, the recovery in 2010 maybe more modest.