Growth Slows Down In The Face Of A Full-blown Trade War

The worst is yet to come as analysts warn that the brewing US-China trade war puts Singapores exports-driven growth prospects in peril.

When Singapore released its advance estimate for GDP growth in the second quarter of 2018, it missed forecasts as both the manufacturing and construction sectors weakened, weakened, whilst services bounced back from the previous quarter— and the worst is likely yet to come as analysts warn that the brewing US-China trade war puts its exports-driven growth prospects in peril.

The 2Q18 advanced estimates, which drew primarily from April and May data, showed the Singapore economy grew at a slower 1.0% on a quarter-on-quarter seasonally adjusted basis, compared to 1.5% growth in the prior quarter. But since the data was collected, the trade spat between the two largest economies has escalated, with the US and China imposing tit-for-tat tariffs on each other’s goods worth $34b on July 6, and the US moving to slap duties on an additional $200b of Chinese goods.