Manufacturing's stellar showing boosts forecasts
Some economists have revised expectations for 2018 to reflect improvement
Electronics manufacturers here are looking to another strong year in 2018, after a slew of new product launches - including the iPhone X - helped lift growth in the sector this year.
Manufacturing, which makes up a fifth of the Singapore economy, has turned in an outstanding report card, prompting some economists to upgrade their forecasts for Singapore's economic growth this year.
DBS Bank senior economist Irvin Seah said in a report out on Wednesday that he now expects the economy to expand 3.2 per cent this year from a previous estimate of 2.8 per cent - due in part to manufacturing's standout performance and a steadily improving global outlook.
Official forecasts tip growth of 2 per cent to 3 per cent for this year, with the final figure expected to be at the upper end of this range.
Mr Seah noted that other sectors besides manufacturing - including services, which makes up two-thirds of the economy - are showing signs of picking up.
"The improvement in the real economy is expected to broaden steadily to the rest of the economy in the coming quarters," he said. "The manufacturing sector, which has been leading this turnaround since the fourth quarter of 2016, is expected to remain in expansion mode, albeit at a marginally slower pace."
Mr Seah has also upgraded his forecast for full-year economic growth next year, from 2.5 per cent to 3 per cent.
But some analysts have warned that the breakneck pace of growth in factory output could begin to cool, even as segments related to oil and gas continue to struggle.
Factory output for the July-to-September quarter grew 18.5 per cent this year over the same period last year, higher than advance estimates of 15.5 per cent previously forecast by the Trade and Industry Ministry.
Mr Allen Ang, group managing director of Aldon Technologies, said the slew of new electronics products released in recent months helped spur a 15 per cent uptick in the firm's business in the first half of this year, compared with the corresponding period a year earlier.
"Our market is related to the end-customer releasing new products and technologies.
"The third quarter was when all the new products, such as the iPhone X, came out," he noted.
The company refurbishes parts for flat panel and semiconductor makers.