Diversity in Singapore's manufacturing portfolio provides stable, sustainable growth

I REFER to the letter by Bobby Jayaraman "Manufacturing saga: data doesn't tally with EDB optimism" (BT, Sept 13, 2017).

Manufacturing is a key pillar of Singapore's economy, contributing about 20 per cent to gross domestic product. Today, Singapore has a diversified portfolio of manufacturing industries, from electronics, chemicals to biomedical sciences. This diversity provides stable, sustainable growth even as each industry's business cycle varies according to its respective market trends. According to the Yearbook of Statistics, value-added in the manufacturing industry grew by 25 per cent from S$55.4 billion to S$69 billion from 2006 to 2015. During the same period, manufacturing productivity growth outpaced other sectors at 2.9 per cent, above the national average of 0.6 per cent.

Specific to the electronics sector, long-term growth has been stable despite its cyclical nature, with a shift in the sector's composition towards more components and modules. For instance, total output of the semiconductor segment has been growing at a compound annual growth rate of 4.9 per cent from 2006 to 2015, though a spike in 2010 was recorded due to its rebound from the 2008/09 financial crisis. EDB's recent monthly manufacturing report indicated that factory output surged 21 per cent in July 2017 from the same month last year, boosted by electronics manufacturing. Statistics from the Purchasing Manager's Index also showed factory activity hit a 33-month high as it rose for the 12th straight month, boosted by electronics.