Feature Articles
Rising Contribution of Services Exports to the Singapore Economy
12 August 2014
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Services-oriented activities are growing in importance in the Singapore economy
The services sector is playing an increasingly important role in the Singapore economy. With the growth of exportable services industries such as finance & insurance and wholesale trade over the years, and as manufacturing industries progressively move into knowledge- and skill-intensive services activities, the Singapore economy has become more services-oriented. Indeed, services’ share of Singapore’s nominal Gross Domestic Product (GDP) has gone up over the last decade, from 64 per cent in 2003 to 70 per cent in 2013. Correspondingly, the share of manufacturing in the economy has moderated from 26 per cent to 19 per cent over the same period. This phenomenon is not unique to Singapore; several developed economies including Japan, Denmark, Sweden, France and the United Kingdom have also experienced a rising share of services as a proportion of GDP over the past decade.
Services exports reflect the growing importance of services activities
The rising contribution of services activities to the Singapore economy is also reflected in our trade statistics. In gross value terms, services trade has grown in size, even though goods trade continues to account for a dominant share of total exports. Specifically, the share of services exports in total exports rose from 16 per cent in 2003 to 23 per cent in 2013, as growth in services exports significantly outpaced that for goods exports over this period.