In an unexpected turn of events, Singapore’s manufacturing sector experienced a remarkable surge in production, with a 29.1 per cent year-on-year increase in October 2024. This impressive growth was primarily driven by a substantial rise in pharmaceuticals, as reported by the Economic Development Board (EDB).
Manufacturing Performance
Excluding biomedical manufacturing, overall output still managed a notable 15.8 per cent increase. Here are some highlights from the recent data:
- Biomedical Manufacturing: An astonishing 89.6 per cent rise, with pharmaceuticals alone spiking by 122.9 per cent due to higher production of active pharmaceutical ingredients.
- Medical Technology: Grew by 7.3 per cent, thanks to sustained export demand for medical devices.
- Transport Engineering: Posted a strong 29.5 per cent year-on-year growth, fuelled by the aerospace sector, which saw a 50.6 per cent increase.
- Electronics Sector: Increased by 26.9 per cent, with infocomms and consumer electronics driving a remarkable 155.6 per cent uptick.
Challenges in Other Sectors
While most sectors boomed, general manufacturing lagged behind with a 5.6 per cent contraction, reflecting declines across various segments. For instance:
- Food manufacturing output dipped by 8.2 per cent, impacted mainly by lower production of products like milk powder and cocoa.
Rising Inflation Concerns
On a different economic note, Singapore’s core inflation rose to 1.2 per cent year-on-year in October, the highest this year. This hefty jump from 0.4 per cent in September can primarily be attributed to rising prices across services, food, and retail. The Ministry of Trade and Industry (MTI) and the Monetary Authority of Singapore (MAS) reported that:
- Overall inflation, as reflected by the Consumer Price Index-All Items, rose to 1.2 per cent in October.
- Core inflation saw substantial growth, particularly in health insurance and healthcare services.
Private transport inflation also noted an uptick, likely due to increased car prices. Despite these pressures, MAS and MTI maintain a cautious optimism. They predict that Singapore’s imported costs will slow in decline moving forward, with an expected core inflation rate of around 0.5 per cent in 2025 and a rise to between 0.5 and 1.5 per cent in 2026.
In a rapidly changing economic landscape, Singapore’s ability to navigate these shifts will be closely observed by both local and international analysts.