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THE Singapore economy grew a better-than-expected 2.1 per cent year-on-year in the fourth quarter of 2014, the Ministry of Trade and Industry (MTI) said on Tuesday morning, as the manufacturing sector contracted less than initially anticipated.
This beat both the initial flash estimate of 1.5 per cent growth, and the market's expectation that this could be raised slightly to 1.7 per cent.
Q4's performance brought full-year growth for 2014 to 2.9 per cent - slightly above the government's January estimate of 2.8 per cent, and exactly at private-sector economists' consensus forecast of 2.9 per cent.
Weighed down by the transport engineering and electronics clusters, the manufacturing sector contracted 1.3 per cent year-on-year, down from the 1.7 per cent growth in Q3. Still, manufacturing's Q4 performance was better than the official advance estimate of a larger contraction of 2 per cent.
Growth in the services sector slowed to 3.1 per cent year-on-year in Q4, down from 3.3 per cent in Q3.
After seasonal adjustments and on an annualised basis, the Singapore economy grew 4.9 per cent quarter-on-quarter - significantly above the flash estimate of a 1.6 per cent expansion.
The Singapore government maintained its 2015 full-year growth forecast of 2-4 per cent.
MTI again flagged the challenging global economic environment, noting that externally-oriented sectors such as manufacturing and wholesale trade are likely to face headwinds going forward.
"Domestically, the labour market is expected to remain tight, with low unemployment and rising vacancy rates. As a result, labour-intensive sectors such as construction, retail and food services may see their growth weighed down by labour constraints. Nonetheless, other domestically-oriented sectors such as business services are expected to remain resilient," said MTI.