Singapore GDP Grew More Than Previously Estimated Last Quarter

Singapore’s economy expanded more than initially estimated last quarter as manufacturing grew even as the government warned a tight labor market will constrain some industries.

Gross domestic product rose an annualized 2.3 percent in the three months through March from the previous quarter, when it climbed a revised 6.9 percent, the trade ministry said in a statement today. That compares with an April estimate of a 0.1 percent expansion. Today’s data was calculated using 2010 prices as a base, instead of 2005 used previously.

The Southeast Asian nation’s economy will be supported this year by quickening expansions in the U.S., Europe and Japan, the Monetary Authority of Singapore said in a report last month. The city-state’s industrial production gained the most in more than two years in February, as manufacturers stepped up output in response to a revival in global demand.

“It’s the manufacturing sector that is the key driver behind the revision,” Michael Wan, a Singapore-based economist at Credit Suisse Group AG, said before the report. “The second half of this year should be the period where growth picks up much more strongly, not just for Singapore but also across the Asia region, on recoveries in the U.S. and Europe.”

The median estimate in a Bloomberg News survey of 13 analysts was for GDP to gain 1.2 percent in the first quarter from the previous three-month period. The survey was conducted before the government said it had changed the base year.

The revised GDP formula takes into account new elements including the capitalization of research and development expenditure and employers’ pension contributions. The methodology was last changed in 2010.

The economy expanded 4.9 percent in the first quarter from a year earlier, after growing a revised 4.9 percent in the previous three months, the trade ministry said today. The median estimate in a Bloomberg survey was a 5.5 percent gain.

The government today reiterated its forecast for the economy to expand 2 percent to 4 percent this year.

To contact the reporter on this story: Sharon Chen in Singapore at schen462@bloomberg.net

To contact the editors responsible for this story: Stephanie Phang at sphang@bloomberg.net Rina Chandran

Singapore GDP Grew More Than Previously Estimated Last Quarter