Singapore’s Industrial Output Grows 26.2 percent in September
by Gallardo Isabel Monday, November 01, 2010
Based on consolidated records, Singapore’s Economic Development Board said that the country’s industrial output increased by 26.2 percent in September 2010 compared to the same period last year – earlier analysts forecast growth rate at 19 percent.
The board also said that the bulk of the industrial output was contributed by the pharmaceutical sector, which has gained some 47.5 percent from last year; followed by precision engineering segment, which has recorded a 42.9 percent growth rate.
Also, the machinery and systems sector was able to sustain its robust growth rate, registering at least 77.4 percent as new factories beefed up production due to high demand in semiconductor-related equipment.
The production in the electronics sector also rose by 28 percent as the demand for tablet computers and other mobile devices continued to increase this year.
But despite the robust growth rate in Singapore’s industrial output, many analysts expressed concern over the volatility of the market, particularly in the biomedical industry, which has seen a 2.1 percent drop in the previous month.
According to Barclays Capital senior regional economist Leong Wai Ho, the area of biomedical has been the area of concern among analysts because of its volatile nature. He also said that if the downward trend to the seasonally-adjusted figures in the biomedical industry continued, a more pronounced downshift could follow in the coming months.
Leong, citing their latest market assessment, said the mid-cycle correction in the biomedical industry could last for two consecutive quarters this year, before slowing down in the first quarter next year.
The analyst also said that as soon as the sector starts to rebound in the first quarter of 2011, Intel Corp’s revolutionary computer chips – called the sandy bridge chipsets – will help propel its growth rate, which will be sustained in the second quarter next year.
Meanwhile, the Economic Development Board said that the total manufacturing output has grown by 31.9 percent in the first nine months of 2010. Analysts also expect the government to raise its preliminary estimates for the third quarter following the robust industrial output in September.
For his part, UBS AG-Wealth Management Research Department chief investment strategist Kelvin Tay has called on the government to also focus development in the country’s services and tourism segments.
Tay said that it would be interesting on how two integrated resorts, to be launched this year, would contribute in the growth of the services and tourism sector of Singapore.
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