Singapore Upgrades 2026 Growth Outlook

(RTTNews) - Singapore's economy is forecast to grow more than previous projections this year as the global economy outperformed expectations, and stronger AI-related exports are expected to sustain.

The Ministry of Trade and Industry forecast the city-state economy to grow "2.0 percent to 4.0 percent" from "1.0 percent to 3.0 percent" in 2026.

In 2025, gross domestic product logged an expansion of 5.0 percent but slower than the 5.3 percent growth seen in 2024.

The earlier November forecast was based on the expectation that GDP growth in major economies would ease in 2026 as the US tariffs worked their way through the global economy.

In the fourth quarter, GDP grew 6.9 percent year-on-year, faster than the 4.6 percent growth seen in the previous quarter.

On a quarter-on-quarter seasonally-adjusted basis, the economy expanded 2.1 percent, moderating from the 2.6 percent expansion in the third quarter.

The stronger-than-expected growth momentum seen in the last quarter of 2025 is expected to carry into 2026. AI investment boom, expansionary fiscal policies in several economies and accommodative global financial conditions should support global growth in the quarters ahead, the ministry noted.

The growth outlook for key trading partners for 2026 has improved since November. Although the pace of growth for most of these economies are still forecast to ease from 2025 levels, due to drag from the full-year impact of the US tariffs and rising trade barriers.

Against this backdrop, the growth outlook for the Singapore's manufacturing and trade-related services sectors for this year has improved. Moreover, the construction sector is forecast to expand at a steady pace due to expansions in both public residential building and civil engineering works.