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GDP grew 4.6% in the first quarter, down from 5.7% in H2 2025.<\/strong><\/p>\n Singapore\u2019s 2%\u20134% growth outlook may be revised down as refinery disruptions hit manufacturing output, according to a Bank J. Safra Sarasin report.<\/p>\n Economic growth moderated in the first quarter, with GDP\u00a0expanding 4.6%, down from 5.7% in the second half of 2025, as manufacturing activity contracted.<\/p>\n The bank attributed the slowdown to weaker demand in the biomedical sector, as well as the Middle East conflict\u2019s impact on the chemicals cluster.<\/p>\n Refining activity has been directly affected, with Singapore\u2019s main refineries operating at around 50% to 60% capacity due to their reliance on Middle East crude. More than 70% of crude oil imports come from the region, exposing the petrochemical industry to supply disruptions.<\/p>\n The chemicals cluster, which includes petroleum and petrochemicals, accounts for about 15% of total manufacturing output and around 1.7% of GDP.<\/p>\n \u201cNatural gas is the main source of electricity generation, but Singapore relies mostly on Malaysia and Indonesia for its gas imports,\u201d the report said. \u201cLNG imports from Qatar account for less than 10% of total gas imports.\u201d<\/p>\n Meanwhile, other sectors contributed to growth. The\u00a0electronics and construction sectors<\/a> remain resilient, with semiconductor output benefiting from global artificial intelligence (AI) demand.<\/p>\n The bank said the government is prioritising AI in key sectors, including advanced manufacturing, connectivity, finance, and healthcare.<\/p>\n \u201cWe expect AI integration and investment, both from the US and China, to underpin medium-term growth,\u201d it added.<\/p>\n Construction activity has also remained strong, supported by large-scale projects such as Changi Airport\u2019s Terminal 5 and the expansion of Marina Bay Sands, as well as public housing developments.<\/p>\n Supply disruptions have also pushed up costs, feeding into higher inflation. The Monetary Authority of Singapore (MAS) has raised its core inflation forecast for the year to 1.5%\u20132.5%, from 1%\u20132% previously.<\/p>\n