(RTTNews) - The gross domestic product in Singapore expanded a seasonally adjusted 14.2 percent in the third quarter of 2009 compared to the previous three months, the Ministry of Trade and Industry said on Thursday.

That was slightly less than the preliminary reading of 14.9 percent following the 21.7 percent quarterly gain in Q2.

On an annual basis, GDP was up 0.6 percent - again revised down, from the preliminary mark of 0.8 percent. The economy had eased 3.3 percent on year in the second quarter.

As a result, the ministry has maintained its GDP growth forecast for 2009 at -2.0 to -2.5 percent. The ministry added that it expects the Singapore economy to grow between 3 and 5 percent in 2010.

“Global economic developments suggest that the recession has ended in most countries,” the ministry said in a statement accompanying the data. “GDP growth in key economies around the world has turned positive, bolstered by unprecedented policy responses which spurred domestic spending. Industrial production has started to pick up gain, while financial conditions and trade flows have corrected from their earlier lows, though not to pre-crisis levels.”

The expansion was led by the manufacturing sector, which grew by 26.6 percent on a quarter-on-quarter annualized basis. Increased production of higher-value pharmaceutical ingredients resulted in a continued surge in biomedical manufacturing output, while the electronics cluster grew modestly on the back of continued restocking activities and an uptick in consumer demand for electronic devices.

The services-producing sectors also saw broad-based improvement, with sequential growth accelerating to 10.8 per cent from 7.9 per cent in the previous quarter. The trade-related and tourism sectors posted double-digit sequential growth, as global trade flows improved and international travel picked up. However, the pace of growth in the financial services sector moderated to 3.9 percent from 22.5 percent in the previous quarter.

The construction sector slowed down, growing by just 0.9 percent compared to the growth of 32.7 percent in the previous quarter. This moderation reflects a reduction in certified payments received for on-going real estate development projects.

“Singapore’s economic outlook for 2010 will be closely linked to global conditions,” the ministry said. “Asia is likely to continue to post positive growth rates, driven by domestic consumption and intra-regional trade flows. However, the recovery in the advanced economies remains fragile, and the return towards pre-crisis levels of output is likely to be gradual.”

The ministry also revised its inflation outlook for 2010, pushing the band up to 2.5 to 3.5 percent from 1 to 2 percent.

The upward revision is attributable to the recent revision in the annual values of HDB properties as announced by the Inland Revenue Authority of Singapore, the ministry said.

The Monetary Authority of Singapore’s underlying inflation forecast, which excludes the cost of accommodation and private road transport, remains unchanged at 1 to 2 percent.

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