Singapore lowers economic growth forecast

Special Report:Global Financial Crisis

SINGAPORE, Jan. 2 (Chinese media) -- Singapore economy is

expected to grow between minus 2.0 percent and plus 1.0 percent in 2009, the

country's Ministry of Trade and Industry (MTI) said on Friday.

The forecast is lower than the minus 1.0 percent to plus 2.0 percent range

it forecasted in November 2008.

The ministry said the global economic crisis has worsened since November,

2008, with sharp declines in global demand, trade and investments.

"These developments will affect the sectors in the Singapore economy that

rely on the movement of goods and services in the region, such as the wholesale

and retail sector, and the transport and storage sector," the ministry said.

The manufacturing is expected to weigh down by falling demand in the

developed economies, while financial services will see a sharp slowdown

reflecting weak financial markets and credit growth, the ministry said, adding

that the slowdown in these sectors will spread to the domestically-oriented

segments of the economy, such as property, retail, and business services.

The ministry said that the weaker prognosis for the Singapore economy in

2009 is also based on the sharp contraction seen in the fourth quarter of 2008.

"Advance estimates show that gross domestic product (GDP) in the fourth

quarter of 2008 contracted by 2.6 percent in real terms over the same period in

2007, following the decline of 0.3 percent in the preceding quarter. On a

seasonally adjusted basis, real GDP fell by 12.5 percent, compared to a decline

of 5.4 percent in the third quarter of 2008," the ministry said.

Singapore's Prime Minister Lee Hsien Loong said Wednesday in his annual New

Year Message that the country's economy grew positive at 1.5 percent in 2008.