Singapore economy grew 7.2 percent in 2021 rebounding from a pandemic-induced 5.4 percent contraction in 2020, according to a preliminary data published. The government is also aiming for a further recovery in 2022, and it is going to be primarily driven by a combination of reopening and booster vaccinations. But the highly contagious Omicron variant is one of the biggest concerns in the bright economic future of the country ahead.
In 2021, Singapore bounced back primarily because of export demand and a fast rollout of Covid-19 vaccines. By the end of the year, 87 percent of its population were fully vaccinated. But the additional challenges of the pandemic also became more apparent later in the year, with Singapore registering the largest Covid-19 outbreak in October 2021, which lead to renewed domestic restrictions and a slow recovery of international travel affecting its core related industries.
Last year’s growth rate was the fastest in 10 years and the economy expanded 14.5 percent, following the global financial crisis. The manufacturing sector also expanded by 12.8 percent after a huge surge for electronic components. The services and construction sectors rebounded by 5.2 percent and 18.7 percent respectively, after being severely hampered by pandemic restrictions.
For the fourth quarter of 2021, gross domestic product (GDP) expanded 5.9 percent year-on-year slower than the 7.1 percent growth in the July-September period. The electronics and precision engineering sectors were still strong in the fourth quarter and it was driven by sustained global demand for semiconductors and semiconductor equipment respectively. For 2022, the government expects a GDP growth rate in the range of 3 percent to 5 percent.