Commentary: Singapore economy set for V-shaped recovery this year but jobs market may take longer to rebound

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While the outlook for the Singapore economy looks promising, several factors are still in play which requires caution, says OCBC’s Selena Ling.

SINGAPORE: After a double-digit slump of 13.4 per cent year-on-year in the second quarter of 2020 during the global lockdown period, the Singapore economy has begun to turn the corner.

The assumed lift to both business and consumer confidence has to happen for the nascent economic recovery to take root and a synchronised upturn to develop.READ: Commentary: Singapore needs a new Smart Nation vision that doesn't leave any citizen behind On the external front, while China has made significant headway as the first-in-first-out of the COVID-19 crisis, other major economies like the US and Eurozone are still experiencing resurgent waves.A boat leaves a pier past the Pasir Panjang container port terminal in Singapore on Nov 11, 2020.

Therefore, manufacturers are rethinking about their use of lean manufacturing strategies and specialised producers to diversify their production risks through on-shoring or near-shoring, as well as hold safety inventories in case of supply shocks. For instance, China saw a record trade surplus of US$78.18 billion in December 2020 as demand for pandemic-related materials, electronics, mechanical and electrical products surged.

In tandem, retail trade and F&B services should also see an improvement from their current dire state. People eat at a busy steamboat restaurant in Singapore as the city state reopens the economy amid the coronavirus disease outbreak, June 19, 2020. REUTERS/Edgar Su

 

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