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Singapore GDP grows 2.2% for year
SINGAPORE (Reuters) -- Singapore's economy grew 0.4 percent in the fourth quarter of 2002, beating a government estimate of 0.1 percent and delivering full-year growth of 2.2 percent. It was propelled by strong factory output which kept the city-state narrowly out of recession. Gross domestic product (GDP, or the total value of all goods and services), grew 3.0 percent in the fourth quarter from a year ago. The figures put Singapore on track for expansion of 2.0 percent to 5.0 percent this year, the government said on Thursday. "Singapore escaped a technical recession by the skin of its nose," said Song Seng Wun, economist at stockbroker GK Goh. "It was pretty much what we were looking for -- a burst of growth in December led by manufacturing in the drugs sector. Factory output upThat trend appears to have continued at least into January, when factory output rose 9.7 percent from December, largely on strength in biomedical sciences, a sector policymakers hope will generate future revenue as low-cost Chinese manufacturers erode a traditional base of electronics production. The official figures beat earlier advanced estimates for the fourth quarter of 0.1 percent annualized growth, released in early January, but were in-line with a full-year estimate. "Going forward, growth will be fairly lumpy. The external sector will perform better with exports rising, but internally, we will continue to see unemployment rising and weaker corporate profits," said Joseph Tan, economist at Standard Chartered Bank. Singaporean state-linked organizations have shed 1,600 jobs in the past four months alone, and the government expects the unemployment rate to rise beyond a 15-year high hit last year to between 5.0 and 5.5 percent in the first half. The Ministry of Trade and Industry, which released the data, said it expected a soft recovery in the global electronics industry, maintaining its 2003 GDP growth forecast of 2.0 to 5.0 percent. Singapore climbed out of its worst recession since 1964 in the second quarter, but risked a double-dip recession after its economy shrank 6.6 percent on an annualized basis in the third quarter -- a figure that was revised on Thursday from a 10.1 percent contraction. The recovery has been patchy, hinging largely on demand for its electronics equipment, which makes up half of the country's manufacturing output and two thirds of its exports. Turbulence in the global economy has kept this sector under severe pressure. The ministry said the consumer price index was down 0.4 percent in 2002. The composite leading indicator, a barometer of business activity over the next nine months, rose 1.5 percent in the fourth quarter over the third quarter. Copyright 2003 Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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