Singapore is hopeful that the recovery in tourism will help its economy avoid a recession this year, despite a worrying global outlook. The Ministry of Trade and Industry (MTI) has suggested that GDP growth is likely to be somewhere between 0.5% and 2.5%, although there may be negative quarter-on-quarter growth in some quarters. The final estimates for Q1 showed better-than-expected GDP growth, with the economy growing 0.4% year-on-year, while gross domestic product fell 0.4% annually from the previous three months. Despite an increase in downside risks from the global economy, the MTI remains optimistic about the resilient service sector, particularly the tourism sector and the transport, hotels, entertainment and recreation industries.
However, Singapore is heavily dependent on trade, and so may still be vulnerable to trade disruptions, particularly from China, its largest trading partner. Enterprise Singapore has also predicted that non-oil domestic exports will fall by 8% to 10% in 2023 due to worse-than-expected export performance and a record contraction in overseas shipments. Despite this, Chief Economist of the MTI, Yong Yik Wei, does not expect a “technological recession” this year.