Singapore economy showed moderate expansion in 2015

SINGAPORE (AP) - Singapore's economy expanded moderately last year, amid concerns of a global slowdown and weak manufacturing data, official figures showed Wednesday.

Gross domestic product expanded by 2 percent in 2015, a drop from 3.3 percent a year earlier, according to the Ministry of Trade and Industry.

The government forecasts economic growth this year of between 1 to 3 percent, "barring the full materialization of downside risks," the ministry said. The forecast is low compared to average growth rates over the past decade.

"The global economic outlook has softened since the start of the year, alongside a sharp fall in oil prices and volatility in global financial markets," it said.

The economy of the trade-reliant city-state at the tip of peninsula Malaysia expanded 1.8 percent in the fourth quarter from a year earlier, unchanged from the third quarter, the ministry said.

Manufacturing contracted in the fourth quarter, while services and construction grew. But the ministry said prospects for construction were weak for this year because of a fall in contracts awarded and sluggishness in private-sector demand.

"The current outlook is subdued due to slowdown of growth in ... developed economies like the U.S, Europe and Japan," said Song Seng Wun, an economist at CIMB Private Banking.

Selena Ling, an economist at OCBC Bank, said the government may soon tweak its forecast for this year "given the growing specter of downside risks coming from China's slowdown, continued oil price and elevated financial market volatilities."

"On the domestic side, structural challenges remain for companies trying to restructure their business activities to enhance productivity and innovation as well as manage manpower... given the weak external demand conditions," she said.