The State economy is expected to expand by 3.5 per cent to 4.0 per cent in 2017, driven by expansion in private sector expenditure and exports, with the services and manufacturing sectors set to continue to be the key drivers of growth.
Second Finance Minister YB Dato Sri Wong Soon Koh explained this during his winding-up speech at the First Meeting of the Second Term of the 18th State Legislative Assembly on 19th May 2017.
The services sector is estimated to grow at 6.4 per cent this year, driven by strong expansion in utilities, wholesale and retail trade, accommodation and restaurants sub-sectors.
For the manufacturing sector, in 2017 it is expected to grow at 4.0 per cent, led by external demand for the State’s resource-based sub-sectors, in tandem with the gradual recovery in the global economy.
As for the construction sector, it is expected to grow by 12.0 per cent this year, and will continue to be led by civil engineering projects, particularly in the infrastructure segment.
The agriculture sector is anticipated to grow by 1.9 per cent in 2017, supported by higher output of CPO, livestock and the fisheries sub-sectors.
The mining sector on the other hand is expected to grow by 6.0 per cent, supported by increased output natural gas and improved product prices.
On the demand side, private consumption for 2017 is projected to improve and grow by 6.6 per cent, sustained by continued wage growth, increase in disposable income and improved global commodity prices.
As for public consumption, it is estimated to expand 1.4 per cent this year, underpinned by lower spending on supplies and services.
For private investment, it is expected to grow by 9.5 per cent, as it continues to be supported by the implementation of on-going and new projects.
Public investment – driven by capital spending by public enterprises in the transportation, utilities, oil and gas, and communications sectors – is expected to expand by 6.8 per cent.
The State expects inflation to remain below 3.0 per cent this year, while labour market conditions are expected to improve further in 2017.
