Singapore’s factory output fell by 1.6% year-on-year in April 2024, as reported by the Singapore Economic Development Board. This decline was primarily driven by a significant drop in the biomedical cluster, which saw a contraction of 29.1%. This performance is notably worse than the median forecast of a 0.5% contraction made by economists in a Bloomberg poll.

Despite this downturn, there was a slight improvement from March, which recorded a more substantial decline of 9.2%. When excluding the volatile biomedical sector, manufacturing output increased by 1.7% in April, rebounding from a 5.9% slide in March.

In the key electronics sector, which constitutes nearly half of Singapore’s manufacturing output, production decreased by 1.1%, marking a slowdown from the previous month’s 11.3% contraction. Within the biomedical sector, the pharmaceuticals segment alone experienced a staggering 54.6% drop, although this was partially offset by a 13.6% increase in medical technology output.

Other manufacturing clusters reported positive growth, including:

Transport engineering: 10.6%
General manufacturing: 7.3%
Chemicals: 3.1%
Precision engineering: 2.9%
DBS economist Chua Han Teng noted that transport engineering was the standout performer in April, driven by demand for maintenance and repair jobs as global air travel continues to recover.

On a seasonally adjusted monthly basis, manufacturing output saw a robust growth of 7.1% in April, reversing a decline of 16.1% in March. Excluding biomedical manufacturing, output rose by 3.6%, improving from an 8.6% decline earlier.

Looking ahead, Singapore’s manufacturing sector is expected to experience a fragile recovery in 2024, following a contraction in 2023. The electronics sector’s performance will be pivotal in this recovery, with expectations of benefiting from ongoing global tech trends.