Singapore, Thailand lower growth projections

SINGAPORE, Feb 17, 2020, Kyodo. Singapore and Thailand on Monday downgraded projections for their economies this year over concerns that a new coronavirus outbreak in China could hurt tourism and other sectors, Kyodo News reported.

In the worst-case scenario, Singapore’s economy could even contract, the Ministry of Trade and Industry said, while forecasting gross domestic product to grow between minus 0.5 percent and 1.5 percent.

The ministry had made a more sanguine forecast in November of 0.5 percent to 2.5 percent GDP growth for 2020.

The hotel and aviation industries are expected to take a hit following Singapore’s ban on visitors from China in the wake of the outbreak. The ban is expected to weigh heavily on domestic consumption.

The last time the Singapore economy went into negative growth was in 2001 when GDP fell by 1.1 percent.

Thailand’s economy is forecast to grow 1.5 percent to 2.5 percent this year, as opposed to 2.7 percent to 3.7 percent forecast in November, according to the country’s National Economic and Social Development Council.

The virus outbreak is expected to hit the Thai tourism sector severely, with 37 million tourists expected this year, down from 39.8 million last year.

The forecast is based on the expectation that the epidemic will end in June. If the outbreak drags on, GDP growth could even be lower than 1.5 percent, according to the council.

The council also cited such negative factors as the impact of a drought on the country’s agricultural sector, a delay in the implementation of a national budget and fluctuations in the global economy.

On Monday, Singapore and Thailand also reported that their economies grew 0.7 percent and 2.4 percent in 2019, respectively. It was the slowest pace since 2014 in Thailand.

In 2018, Singapore’s economy expanded 3.4 percent, while Thailand’s GDP grew 4.2 percent.