S'pore electronics output down 20%

Electronics output in May fell by a record 20 percent here, prompting economists to speculate that the island might already be in a technical recession.

SINGAPORE--Electronics output in May fell by a record 20 percent here, prompting economists to speculate that the island might already be in a technical recession.

A technical recession is when two consecutive quarters register negative growth compared with the preceding quarter.

"Without having to wait for June data, we are in a technical recession due to the sharper-than-expected deceleration in the critical manufacturing sector," declared GK Goh Research regional economist Song Seng Wun. He forecast the economy to grow by 1.5 percent this year.

"We are getting closer to technical recession territory," IDEAglobal.com regional economist Paul Schymyck told The Straits Times. Schymyck predicted a full-year growth of between 3 and 3.5 percent.

Electronics forms nearly half of all manufacturing output, and pulled the manufacturing figure for May down 10.9 percent from last year.

Before this May's massive drop, the previous record plunge for electronics was 16 percent in June 1985, which was a precursor to the 1985-86 recession.

Electronics production also fell 12.5 percent in July 1998, the year when the economy grew a marginal 0.1 percent.