Singapore SMEs in contractionary mode for fifth straight quarter: OCBC

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SMALL and medium-sized enterprises (SMEs) were in contractionary mode for the fifth consecutive quarter, the latest OCBC SME Index released on Tuesday (Apr 16) indicated.

The bank’s latest quarterly index registered a reading of 49.7 points in the first quarter of 2024, edging up slightly from 49.5 points in the preceding quarter.

This came as SME collections and payments grew by 1.4 per cent and 1.9 per cent year on year respectively, against the backdrop of bumpy disinflation trends and elevated cost pressures.

The index measures SME business health and performance. A reading above 50 indicates improved activity, while one below 50 indicates a deterioration relative to the same period a year ago.

Domestically oriented sectors such as education and food and beverage (F&B) continued to outperform, turning expansionary in Q1 2024.

Education rose to 50.5 points, up from 49.7 points previously. Growth was propelled by expansions in training centres and recreation classes.


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F&B rose to 50.2 points, up from 49.6 points the previous quarter. This was due to gains in both F&B retail and F&B services, with businesses likely benefiting from higher domestic consumption during Chinese New Year and tourism receipts.

The retail sector has also “shown signs of resilience and registered modest growth” over the past quarters, said OCBC, supported by sustained international visitor arrivals and healthy non-discretionary spending. It has maintained a reading of 50.9 points for the last three quarters.

While SMEs in outward-oriented industries such as manufacturing, transport and logistics and wholesale ...

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