Technical recession for S’pore depends on electronics, US, China economies

  • Whether Singapore’s economy enters a technical recession will depend on near-term external factors such as how the global electronics industry will fare, as well as the state of the Chinese and United States economies, said Deputy Prime Minister Lawrence Wong.
  • The factors of de-risking or decoupling in the world economy are broader, longer-term concerns, he added, in an interview on Friday with the Singapore media at the end of his official trip in Japan.
  • Singapore’s economy shrank 0.4% in 1Q23, over 4Q22, official data showed on 25 May. This means the Republic is at risk of a technical recession, which is defined as two consecutive quarters of contractions.
  • Among the external challenges that Mr Wong cited were a downturn in the global electronics industry, the state of the Chinese economy, and whether the US economy achieves a soft landing.
  • The global electronics downturn – with a slump in worldwide demand in advanced economies such as the US and the European Union – has hit Singapore’s manufacturing activity. Electronics accounts for 42% of Singapore’s manufacturing output.

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