theSun | THURSDAY JANUARY 22 2009
business
Singapore facing its
worst-ever recession
SINGAPORE: Singapore
faces its worst ever recession
and yesterday cut this year’s
economic outlook after the
city-state suffered its biggest
quarterly fall on record, the
government said.
The downgrade is the sec-
ond this month and reflects a
faster and deeper decline in
global economic activity, and
stronger “spillover effects” on
key sectors of the domestic
economy, the Ministry of Trade
and Industry said.
The government forecast
17
in the fourth quarter,” said Song
Seng Wun, a regional economist
with CIMB-GK Research.
The fourth-quarter drop is the
largest since records began in
1976. Economists polled by Dow
Jones Newswires had forecast a
median 13.1% contraction in the
economy during the final three
months.
Manufacturing, in particular
poor performance by the electron-
ics sector, led the fourth-quarter
fall with a year-on-year decline of
shrinkage of between 2 and 5% curred in 2001 when the econ- 10.7%, DBS Group Research said.
for this year, which follows a omy contracted by 2.4%, figures Singapore in October became
previous estimate of a contrac-
tion of 2% to growth of 1%.
from the ministry showed.
Data released yesterday con-
the first Asian economy to enter
a recession but since then major briefs
For 2008 as a whole, the firmed a worsening recession, economies around the world
economy grew an estimated where the economy shrank at – including the country’s key
1.2%, the ministry said, com- a sharper pace in the fourth export markets the European
pared with 7.7% in 2007. quarter than the government Union and the US – have also Vehicle sales expected to drop 12%
“The Singapore economy and economists had forecast. been declining. KUALA LUMPUR: The Malaysian Automotive Association
is going through its sharpest, On a seasonally adjusted, The city-state is Southeast (MAA) expects total vehicle sales to drop by 12.4% this
deepest and most protracted annualised quarter-on-quarter Asia’s wealthiest economy in year to 480,000 units from 548,115 units last year due to
recession,” said Ravi Menon, basis, the economy fell by terms of gross domestic product the full impact of the global financial crisis, despite the car-
second permanent secretary 16.9%, after a decline of 5.1% in per capita but its heavy depend- ried-over orders from the strong performance of 2008.
with the ministry. the third quarter and 5.5% in the ence on trade makes it sensitive The passenger and commercial vehicles segments
Singapore’s worst recession second, the trade ministry said. to economic disturbances in are expected to fall 12.2% and 14.7% respectively.
since independence in 1965 oc- “The economy fell off the cliff developed nations. – AFP Last year, Perodua maintained its top ranking for total
vehicles sales with 30.5% market share, followed by
Proton at 25.9% and non-national car Toyota at 18.5%.
MAA president Datuk Aishah Ahmad said the forecast
‘Second package must focus on for 2009 was also based on other factors, including the
expected moderation in the country’s growth to 3.5% this
manufacturing, construction’ year from an estimated 5% and unfavourable consumer
sentiment due to employment market uncertainties.
KUALA LUMPUR: The govern- said, it will increase to 4% from She said also taken into account were uncertainties
ment should focus on manufac- the current 3.5% given the cur- due to inflation, fluctuations of oil and commodity prices,
turing and construction sectors rent economic climate. and unfavourable foreign exchange rates. – Bernama
in its proposed second stimulus To help revitalise the do-
package to reduce retrench- mestic economy, the chambers Nestle plans new chilli farms
ments as the global economic introduced a six-point plan, PASIR PUTEH: Nestle Malaysia Bhd plans to open
crisis worsens, a Chinese as- stressing on energy cost, infra- new farms in Johor and Malacca to ensure an ad-
sociation said yesterday. structure development, con- equate supply of between 600,00 to 800,000 metric
Associated Chinese Cham- struction and property industry tonnes of fresh chillies.
bers of Commerce and Industry and gas supply to maintain Nestle agricultural officer Yong Lee Kheng told
of Malaysia (ACCCIM) president employment and encourage reporters yesterday the plan is necessary to support
Tan Sri William Cheng said these local and foreign investments. the needs of the company’s plant in Petaling Jaya
two sectors would be the most On energy cost, Cheng said since there is an increasing demand for chilli sauce.
affected by the crisis especially the price of gas as a “feedstock” “At present, we are only receiving our supply from
during the first-half of this year. for manufacturing should also Hitz by the Bukit Awang, Pasir Puteh, Local Farmers’ Associa-
“We expect retrenchment in revert to the old price of RM6.80 morning tion under a contract farming agreement.”
these two sectors will likely be million British thermal unit He said that the company did not wish to become
more serious during this period,” (mmbtu) to ease the burden of madness
too dependent on the Local Farmers’ Association for
he said after revealing findings of higher cost operations. pg 24 its supply, as Kelantan experiences annual floods
its survey report on the economy It also urged speedier which could impact on requirements. – Bernama
for the second half of 2008. disbursement of RM220 billion
According to the survey, 47% that has been allocated for
of the respondents intend to infrastructure development to Shares slide despite Obama’s ascent
downsize their workforce while benefit the people and boosting HONGKONG: Continued signs of trouble in the financial
52% said they would maintain the construction industry. sector and worrisome economic data sent Asian shares to
their current workforce. On property, the government six week lows and oil below US$41 a barrel yesterday.
During the second half of should look at introducing more Barack Obama became US president on Tuesday with
last year, manufacturers were measures to encourage first- a message of hope and resolve that has so far failed to
facing difficulties following a time property buyers such as convincingly sway investors. A measure of global stocks
drop in foreign and domestic offering special interest rates yesterday hit its lowest since Dec 5, dragging stocks back
demand, Cheng said. and reduce quit rent. towards the 5-½ year lows hit in late November.
Therefore, the Chinese busi- On gas supply, ACCCIM en- On Tuesday, US markets posted a record Inauguration
ness fraternity is pessimistic courages industries to operate Day drop. The MSCI index of Asia-Pacific stocks outside
about the economic outlook for during the off-peak period to re- Japan fell for a second consecutive session, trading down
the first half of this year, he said. duce electricity demand during 1.7% by 0705 GMT (3.05pm in Malaysia) and earlier hit-
On unemployment rate, he the peak period. – Bernama ting its lowest since Dec 8. – Reuters