International Monetary Fund. Asia and Pacific Dept
INTERNATIONAL MONETARY FUND
A cyclical upswing in growth is under way driven by goods trade.
But improved momentum has yet to extend beyond the export-oriented sectors, and
structural headwinds to growth from aging, tighter foreign worker policies, and slow
productivity growth remain. Inflation has turned positive after two years of subzero
readings and the financial cycle is firming. Singapore's external position continues to be
substantially stronger than warranted by medium-term fundamentals and desired
policies. Risks to the outlook are broadly balanced. Being highly open to trade and
financial flows, Singapore stands to benefit from improving global sentiment. But more
inward-looking policies in major economies and slowdowns in emerging economies
would have an adverse impact. Domestic risks mainly relate to elevated household and
corporate sector leverage, and the disruptive potential of economic restructuring
through new technologies and automation for employment and inequality.