Globaltraded.com , Singapore — According to a comprehensive study conducted by DBS Group Research as published in “Singapore Outlook 2024: A year of renewal”, Singapore is poised for an economic resurgence in 2024, buoyed by a cautiously optimistic external environment. The research anticipates a notable uptick in the country’s real GDP growth, projecting a rise from the subdued 0.9% in 2023 to a more robust 2.2% in the coming year. Despite grappling with multifaceted global challenges, Singapore stands out as a steadfast and reliable hub for international business and finance.
The study sheds light on the country’s response to a world fraught with what it terms “polycrisis,” encompassing geopolitical tensions, macroeconomic uncertainties, climate change disruptions, and the complexities of an aging population. Against this backdrop, 2024 is envisioned as a year of renewal for Singapore’s economy, characterized by key themes and transitions.
Significantly, the research underscores the pivotal role of the manufacturing sector in Singapore’s economic revival. Initial indicators point towards a turnaround in factory activity in the last quarter of 2023, with expectations of a return to modest expansion in the manufacturing domain throughout 2024.
DBS analysts also highlight Singapore’s strategic positioning to capitalize on ongoing supply chain shifts and investments in ASEAN. The city-state is expected to attract fixed asset investments, providing stability amid the persistently uncertain global economic landscape.
In terms of policy dynamics, the study anticipates a leadership transition to 4G leaders in 2024, coupled with a balance in fiscal policies to address short and long-term priorities. Monetary policy decisions are expected to align with global trends, possibly moving towards normalization in tandem with other central banks.
The labor market outlook for Singapore in 2024 suggests a less tight scenario, with a cooling demand reflected in quarterly employment changes. Wage growth is anticipated to ease, aligning with a more relaxed labor market and subdued business intentions to raise wages.
In the realm of foreign exchange, the USD/SGD exchange rate is predicted to remain within the 1.30-1.38 range, with a downside bias as the year progresses. The study also delves into the dynamics of SGD rates, hinging on global economic adjustments to heightened interest rates.
Despite the myriad challenges, Singapore’s resilience is attributed to several enduring advantages, including political stability, a robust rule of law, extensive regional connectivity, and a pool of highly skilled talent. The study concludes that Singapore’s economic trajectory in 2024 will navigate the complexities of a rapidly evolving global landscape with cautious optimism. (GT)
