Singapore Economic Performance - ECON1042
Added on 2020-03-07
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Running Head: Singapore Economic PerformanceSingapore Macroeconomic Analysis (2005-2014)Student NameInstitutional AffiliationCourse/NumberInstructor NameDue Date
Singapore Economic Performance2Singapore Macroeconomic Analysis (2005-2014)IntroductionSingapore is an island country located in Southern Asia between Malaysia and Indonesia. Its size is 697 sq km with 10 sq km being covered by water and the rest by land (Cia.gov, 2017). This economy’s population is approximately 5.8 million. The economy has strong trade links and is a major tourist destination. It has many natural and artificial features that has contributed to its improved demand for tourism activities. The improvements in the transportation sector has improved the trading networks with other major trading economies. This economy has the busiest port in the world (the Singapore port); the number of containers handled in this port are many in comparison to other major ports. This economy has been experiencing growth in the current years owing to the improved performance in the manufacturing sector attributed to increased external demand (FocusEconomics, 2017).Production Output Performance Analysis Singapore Real GDP The definition of GDP provided by many scholarly articles and many economists is that it is a monetary value of everything a country produces in the given year. Its measure of economic growth is that it is an important true for deriving the real growth rate and the GDP per capita. The higher the real GDP, the higher the GDP per capita if there is no variation in the population change. It is referred to as real GDP when it is in the constant prices; meaning that it is estimated with a basis of a set year price. This ensures that a change in prices does not cause a change in GDP that cannot be compared with the other years.
Singapore Economic Performance3Fig: Real GDP for Singapore2005200620072008200920102011201220132014050100150200250300350400450Real GDP for Singapore YearRealGDP(Billions)The total monetary value of all goods produced within the Singapore boundaries for the 10 years is presented in the graph above and is expressed into real terms. The trend line is derived to show the direction in which production is taking, in the graph, the real GDP can be argued to have gone up from 2005 to 2014. The increase have been recorded every year except in 2009; this is because there was a global financial crisis during this period which led to contraction of economies. Singapore was not much affected by the GFC as there was an increase in the value of production if the subsequent years.Singapore Real GDP Growth RateThe economy grows at different rate every year. It is nearly impossible for an economy to experience an equal growth rate for two consecutive periods. The economicsituations are different every year and this explains the existing differences. Real GDP growth rate is thus a measure of the changes in the Real GDP from a period to another.It measures the economic performance in that it helps the policy makers and the interested parties to determine whether the economy is contracting or expanding. Also when the economy is expanding, it helps determine whether this is at an increasing or
Singapore Economic Performance4decreasing rate. A healthy economy should be experiencing a periodical increasing growth rate which is at an increasing rate.Fig: Singapore real GDP growth rate2005200620072008200920102011201220132014-2024681012141618Real GDP Growth Rate for Singapore YearRealGDPGrowthRate(%)The real GDP growth rate for Singapore was very impressive from 2005 to 2007; an observation from the graph above can reveal an increasing growth rate during this three years. There was a sharp decline in the growth rate in 2008 and a continued fall in2009 where the economy’s growth rate was less than zero. The negative growth rate coupled with the fact that the rate had fallen for two consecutive periods is an explanation that Singapore was in a recession in 2009. The recession did not last for long as a positive growth rate (highest level ever; more than 1.5 time the high level recorded in 2007) was recorded. This was good for this economy but was not sustained as there was a more than a half decline in 2011. The rate continues to fall and the lowest rate since the recovery was achieved in 2010 got recorded in 2014. On average, the Singaporean real GDP growth rate fell in this 10 year period as shown by the trend line.Singapore Real GDP per Capita It is the division of the Real GDP value for an economy by its population that we arrive at the real GDP per capita. It thus shows the worth of each individual in the given economy. It is used in the estimation of economic growth as an economy’s health is
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