Electronics Leads the Recovery with Significant Year-on-Year Growth
In October 2023, Singapore’s factory output saw a 7.4% year-on-year increase, surpassing market expectations after a prolonged 12-month slump. This marks a significant recovery for the manufacturing sector, with the electronics sector being the standout performer. Output in electronics expanded by 14.8%, continuing the positive momentum from the previous month’s 12.7% growth. This was largely driven by strong performance in the semiconductor segment, despite some declines in other areas.
Other sectors also contributed to the recovery, with biomedical manufacturing seeing a 5.1% year-on-year increase, reversing the previous month’s 19% decline. Transport engineering and general manufacturing also posted positive growth of 12% and 4.3%, respectively. However, chemicals and precision engineering saw weaker performances, with chemicals output dipping by 1% and precision engineering contracting by 2.2%.
Despite the positive rebound, economists caution that the recovery remains fragile, with uncertainties stemming from global economic conditions, such as high interest rates in advanced economies and challenges in China. While some analysts predict that electronics exports may turn positive by December, the broader recovery in the first half of 2024 could be dampened by tight global financial conditions.
Nonetheless, there is optimism for a more sustained recovery in the second half of 2024, with stronger global trade and China’s economic recovery potentially driving further growth in sectors like electronics, transport engineering, and general manufacturing.
