Singapore manufacturing reports surprise turnaround with 6.7% growth

Severe downturn continued in offshore engineering segment which reported a 31.5 percent decline.

Singapore manufacturing output
A general view of factories at an industrial park in Singapore September 16, 2014. Reuters

The manufacturing sector in Singapore made a surprise turnaround in September, logging in a 6.7 percent rise in output compared with the same period a year ago. According to data released by the Economic Development Board (EDB) on Wednesday, solid performance by the electronics and pharmaceuticals sectors helped the manufacturing sector buck the recent trend.

The rise in factory output was far greater than expected, with the median forecast in a Reuters survey showing an expansion of 0.6 percent. On a month-on-month and seasonally adjusted basis, manufacturing output expanded 3.3 percent in September.

The output growth in the crucial biomedical manufacturing sector was 22.2 percent in September from a year ago. The pharmaceuticals segment grew 26.9 percent, helped by higher production of active pharmaceutical ingredients and biological products. Meanwhile, the medical technology sector expanded 9.6 percent.

The electronics sector expanded 15.9 percent while the semiconductors output registered a growth of 34.8 percent.

Impressive growth in all these sectors helped offset a continued severe downturn in the in the marine and offshore engineering segment, which reported a 31.5 percent decline.

The central bank said on Tuesday trade dependant Singapore economy weakened over the past six months with all sectors seeing a broad-based downshift.

The Monetary Authority of Singapore said the relatively steady but mediocre growth in external demand is likely to continue over the near term.

Data showed last week Singapore's gross domestic product contracted 4.1 percent on a quarter-on-quarter basis, compared with 0.2 percent growth in the previous quarter, the Ministry of Trade and Industry's advanced estimates released on Friday showed.