Singapore's growth quickened in 2013 and the country will "do well" going forward, Prime Minister Lee Hsien Loong said.
Gross domestic product rose 3.7 per cent this year, Lee, 61, said in his New Year message today. That's in line with the government forecast of 3.5 per cent to 4 per cent growth and compares with the median in a Bloomberg News survey of economists for a 3.55 per cent expansion.
"The European and American economies are stabilising," Lee said. "Asian prospects are still positive, but there are problems and tensions," he said, citing regional geopolitical disputes.
Singapore's economic acceleration this year has been aided by recoveries in the US and Europe, while companies in the city-state adjusted to rising business costs and curbs on cheap foreign labour. The island's trade promotion agency said in November exports will rebound in 2014 after contracting this year, easing pressure on the central bank to allow its currency to weaken to support overseas shipments.
Lee reiterated a forecast for the economy to grow 2 per cent to 4 per cent in 2014. US consumer confidence is at a four- month high and euro-area factory output grew at a faster pace than economists forecast in December.
"The global picture is improving, especially with China also bottoming," said Vishnu Varathan, an economist at Mizuho Bank Ltd. in Singapore. "Manufacturing will continue to improve, particularly with the worst of the effects of the electronics restructuring probably having come through."
Singapore's trade ministry will release preliminary fourth- quarter GDP figures at 8 a.m. local time on January 2. The economy probably shrank an annualised 1.3 per cent from the previous three-month period, according to the median of 11 estimates in a Bloomberg survey.
The Singapore dollar has dropped about 3.5 per cent against its US counterpart this year. The benchmark Straits Times Index of stocks was little changed in 2013, making it the worst- performing among developed markets.
