Singapore cuts 2020 growth prediction for third time hinh anh 1A McDonals's store in Singapore on May 11, 2020 (Photo: AFP/VNA)

Singapore (VNA) - Singapore slashed its 2020 gross domestic product forecast for the third time, the Ministry of Trade and Industry said on May 26, as the economy prepares for its deepest ever recession.

The country lowered its growth forecast to a contraction range of -7 percent to -4 percent from the prior range of -1 percent to -4 percent. Singapore’s economy shrank 0.7 percent annually in the first quarter and 4.7 percent on a quarter-on-quarter, a less severe decline than advance estimates.

Reuters quoted Gabriel Lim, permanent secretary of the ministry, as saying a significant degree of uncertainty continues over the length and severity of the COVID-19 outbreak, as well as the trajectory of the economic recovery.

Singapore also downgraded its 2020 prediction for non-oil domestic exports to -4.0 percent to -1.0 percent, from -0.5 percent to 1.5 percent previously. Exports have been a rare bright spot for the economy in recent months due largely to a surge in demand for pharmaceuticals.

Analysts expect the trade-reliant economy to see a deeper contraction in the second quarter due to a two-month lockdown by authorities, in which most workplaces closed to curb the spread of the coronavirus.

Singapore is facing its deepest recession ever, with authorities warning that the rate of unemployment might rise while wages will decrease. The government first flagged the possibility of recession in February when it cut its 2020 GDP forecast to -0.5 percent to 1.5 percent, from 0.5 percent to 2.5 percent previously.

The nation has among the highest number of infections in Asia and has said that easing of the lockdown from next month will only be done gradually. The finance ministry is set to deliver the latest in a string of multi-billion-dollar economic packages to offset the hit to businesses and households from the pandemic later on May 26./.