Singapore economic growth surges ahead

| April 14, 2010 | 0 Comments
Singapore economic growth surges ahead

The Trade and Industry Ministry today announced that Singapore’s economy saw first quarter annualised growth of 32.1% - compared with a 2.8% fall in the previous quarter.

According to the Ministry, the growth was driven by manufacturing activity and the central bank has therefore raised its 2010 growth forecast to between 7% and 9%.

The figures come just a few months after the International Monetary Fund said Asia will lead the way in the global recovery.

However, the Singapore economy is facing inflationary pressures - as well as many other Asian economies, including China.

China, which is the region’s biggest exporter, has been under pressure to allow the yuan to find its own level in order to ease inflation, which is at a 16-month high.

However, Singapore has allowed its currency to rise in value against the US dollar in an attempt to control economic growth and inflation.

China, however, has told President Barack Obama that it is committed to yuan reform but will not be pressurised into making changes to its currency peg.

Keeping the yuan stable is “an important contribution” to global recovery said China. US legislators and trade groups say the yuan, which is also referred to as the renminbi, is kept up to 40% below what its value should be against the US dollar.

The Chinese currency pegged the US dollar until 2005 when it was allowed to rise in value by about one fifth.

The peg was reinstated in July 2008 when the global financial crisis took hold, amid US concerns of the impact on trade.

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