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DIRECTORY OF SINGAPORE PROCESS & CHEMICALS INDUSTRIES 2021/2022
This has also led to oil and chemical companies considering creating more agility in their operations by “reshoring”, “nearshoring” and diversifying into other areas, it added.
Deloitte also said in the report that, “The pandemic has helped accelerate reliance on digital technologies across sectors. In oil, gas, and chemical companies, remote monitoring and increased analytics have assisted in opening up new cost-saving avenues in the face of low prices and reduced hiring”.
The global outlook remains cautiously optimistic. The International Monetary Fund (IMF) in July 2021 forecast global growth of 6% for 2021, unchanged from the previous outlook in April. For 2022, it projected global growth of 4.9%, up from its previous forecast of 4.4%.
It raised its forecasts for the United States to 7% in 2021 and 4.9% in 2022, up 0.6 and 1.4 percentage points, respectively, from its earlier outlook in April.
The ASEAN 5 countries were given a projection of 4.3% growth in 2021 and 6.3% in 2022.
But Gita Gopinath, IMF’s chief economist, warned, “While more widespread vaccine access could improve the outlook, risks on balance are tilted to the downside. The emergence of highly infectious virus variants could derail the recovery
and wipe out US$4.5 trillion cumulatively from global GDP by 2025.”
Earlier in May 2021, IMF was reported to have given the Singapore economy a clean bill of health.
It said, “Singapore has implemented a bold, comprehensive, and coordinated policy response to cushion the impact of the Covid-19 pandemic....... The uncertainty surrounding the outlook is larger than usual, but risks are balanced.”
At end-July, the EDB released findings of its quarterly survey that indicated business optimism in Singapore’s manufacturing and services sector had cooled.
It said the manufacturing sector registered weighted percentages of 26% positive and 6% negative responses for the second half of 2021 compared to 41% and 3% respectively from the last survey. The drop was attributed to a return to Phase 2 (Heightened Alert) in late July 2021 following a surge in the Covid Delta variant here and elsewhere.
A month later, the Singapore Ministry of Trade and Industry announced that the economy grew 14.7% in the second quarter of 2021, resulting in a “better-than-expected” 7.7 per cent in first half of 2021. It attributed the strong growth to the low base in 2020 due
to Covid-19 circuit breaker measures in April and May that severely impacted economic activities.
The ministry’s forecast for Singapore GDP growth was revised to between 6 and 7% this year, after an initial forecast of between 4 and 6% growth.
It was in anticipation of external demand recovery to remain “largely on track” for the rest of 2021.
Growth in the Southeast Asian region remained cloudy as it continued to battle the new wave driven by the Delta variant and to catch up on vaccination for their people. This had led economists to scale down their full-year growth projections for the rest of the region’s economies.
For Singapore the general outlook stayed cautiously positive but, going forward, process industry members would need to be better prepared so that they can be more responsive and agile as they continue to face uncertain economic conditions. Not only do they have to reckon with the continuing threat of Covid-19, but the looming backlash as well against oil and chemical companies on carbon emission in the light of increasing concerns about climate change.
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