Prime Highlights:
Singapore’s industrial production (IP) is projected to grow by 3% in 2025, with key sectors such as electronics, precision engineering, and transport engineering driving this growth.
RHB anticipates that both 4Q24 and full-year 2024 GDP growth will likely be revised upward, exceeding the Ministry of Trade and Industry’s (MTI) initial estimates.
December 2024 saw a 10.6% YoY increase in IP, surpassing market expectations and RHB’s forecast, though slightly lower than November’s revised 10.8% growth.
The electronics sector, which constitutes nearly half of Singapore’s manufacturing output, grew by 14.3% YoY, driven by sustained global demand for electronic products.
Key Background:
Singapore’s industrial production (IP) is expected to grow by 3% in 2025, according to RHB, supported by strong performances in key sectors such as electronics, precision engineering, and transport engineering. This growth forecast is in line with the city-state’s projected GDP growth of 3% for the same year.
RHB’s report also highlights a likely upward revision of Singapore’s 4Q24 and full-year 2024 GDP growth, which will surpass the Ministry of Trade and Industry’s (MTI) advance estimates. In December 2024, Singapore’s IP saw a notable increase of 10.6% year-on-year (YoY), exceeding market expectations of 6.4% YoY and RHB’s forecast of 3.3% YoY. While this represented a slight decline from the revised 10.8% YoY growth recorded in November, it still reflects solid expansion within the industrial sector.
Key drivers of this growth include robust performances in the electronics and transport engineering sectors, both of which saw double-digit increases in output. The electronics sector, which accounts for nearly half of Singapore’s manufacturing output, grew by 14.3% YoY, although this was a deceleration compared to the previous month’s 31.3% YoY rise. Despite this moderation, the sector continues to benefit from strong global demand for electronic products and the broader growth in international trade.
The favorable global economic environment is expected to further bolster Singapore’s growth. Analysts predict a 2% GDP growth in the US and a 4.8% expansion in China, supported by easing global monetary conditions. However, there are still potential risks, particularly from geopolitical uncertainties and trade protectionism, which could impact Singapore’s export-driven economy.