Singapore and other very trade-dependent markets will be the hardest impacted by these financial tightening steps. Singapore’s trade-to-GDP ratio was 336.86 % in 2022, up 3.52 percent from 2021.
Due to the decline in global demand, Singapore’s export-led producing industry, which accounts for between 20 and 25 percent of its GDP, has remained subdued since October 2022.
Demand for consumer technology has decreased as a result of the pandemic-fueled increase, and another political ambiguities have also negatively impacted Singapore’s semiconductor business.
The manufacturing business as a whole has already been negatively impacted by the problems with the semiconductor industry, which decreased by 2.6 % year over year in the fourth quarter of 2022. However, compared to an 11.6 % decline in August 2023, the decrease in manufacturing output eased to 2.1 % year over year.
The demand for artificial intelligence, or nbsp, is one of the main causes. As a result, the output in the electronics sector increased by 12.7 % year over year in September 2023 and 14.8 % in October. European chipmakers and suppliers have even moved to expand their output bases in Singapore as a result of the ongoing US-China chip war.  ,
The buying manager’s index in Singapore is returning to positive territory, which may portend a more upbeat future for the industry in 2024. With a full resource size of about US$ 2 trillion, the banking and finance sector is crucial to funding the expansion of trade and infrastructure.  ,
However, rising interest costs have increased the cost of financing mortgages, which has significantly raised the price of new home construction. Spikes in the cost of new homes and rental rates have been caused by rising building fees and a shortage of fresh cover brought on by building regulations during the pandemic.
Rising demand brought on by the economy’s beginning and the transfer of international human funds to Singapore further fueled skyrocketing home prices and rents. The increase in housing source is easing obstacles, stabilizing rental costs, and slowing rate rises for new houses as we approach 2024.
The financial industry had also been dealing with an ongoing anti-money laundering campaign that had resulted in 10 arrests and more than$ 2.8 billion ($ 2.1 billion ) in assets and cash linked to international gambling syndicates.  ,
In the future, financial regulators will tighten regulations to reduce the increase in economic computer fraud as well as the flow of illegal funds within the city-state.
On the plus side, Singapore is benefiting from the commencement of air journey, tourism, and associated activities after opening its borders article Covid- 19.  ,
International guest immigrants are anticipated to reach 12 to 14 million in 2023, which is two-thirds to three-quarters of their 2019 levels. Travel and tourism revenue is expected to reach$ 3.27 billion by the year’s end.
However, the possibility of increase in the Middle East and Ukraine wars, as well as political tensions between China and the United States, may sabotage vacation plans and global supply chains, leading to sharp rises in energy and commodity prices. Singapore would suffer greatly as a local hotspot for transportation and logistics.
According to international changes, Singapore’s prices continued to rise in the first quarter of 2023, but there was  , some easing by June. In the first third of 2024, core inflation is anticipated to rise, which is a better indicator of the value increases that the majority of Singaporean families experience.  ,
This is in line with the GST increase, which is expected to range from 8 to 9 % on January 1, 2024, as well as rising water, light, and transportation costs. On September 28, 2023, the Ministry of Finance unveiled a S$ 1.1 billion ($ 825 million ) Cost-of-Living Support Package to support rising living costs.
In the second quarter of 2023, Singapore’s business underwent an unforeseen development that effectively averted an impending professional downturn. Singapore’s GDP increased by 0.7 % on a year-over-year basis in the second quarter of 2023, according to the Ministry of Trade and Industry.  ,
The economy expanded by 0.3 % on a quarter-on-quarter seasonally adjusted basis, which is an improvement over the 0.4 % contraction in the first quarter of 2023.
Due to the treatment in foreign visitor arrivals, the lodging industry experienced strong growth. The annual Formula 1 Grand Prix and Music Festival helped Singapore’s event-hosting page.
During Malaysian Prime Minister Anwar Ibrahim’s attend to Singapore in January 2023, the two nations signed bilateral treaties to strengthen their participation in the online, clean, and security sectors, which also improved their financial ties.
Both officials discussed strategies for accelerating cross-border economic relations by establishing the Johor-Singapore exclusive economic zone at the 10th Singapore-Malaysia Leaders ‘ Retreat later in the year.
As the services business and travel business offset the decline in production and the weaker economic sector with above-trend growth following the end of Covid- 19 curbs, the Singapore economy avoided an illegal recession.
At the Lee Kuan Yew School of Public Policy, National University of Singapore, Faizal Bin Yahya holds a senior research fellowship in the university of policy experiments.
This andnbsp, article, and was initially published by East Asia Forum and are being reprinted with permission from Creative Commons.