Singapore's economy performed better than estimated in the second quarter, but recovery will be "sluggish" on continued weak demand from the US and Europe, the government said yesterday.
The trade-reliant economy expanded by a seasonally adjusted 20.7 per cent in the June quarter from the previous three months, better than the estimated growth of 20.4 per cent released last month.
The expansion marks Singapore's first quarter-on-quarter growth in five quarters and analysts said this suggests the economy is emerging from its worst recession since independence 44 years ago. It followed a quarter-on-quarter dive of 12.2 per cent in the first three months.
The trade ministry noted that industrial production and consumption in Singapore's key export markets such as the US and Europe are still weak and unemployment remains high.
"Without a turnaround in these demand-led indicators, any economic recovery in the second half of the year will probably be sluggish and modest," it said.
As a result, the government is maintaining its forecast for the economy to shrink between 4.0 and 6.0 per cent this year.
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