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With the slow recovery in the global economy driven by the continued risks emanating from
the Eurozone and the US, GDP growth in a number of Asian economies registered a slower
than expected performance in 1Q 2013. Singapore’s GDP contracted 0.6% year-on-year
(YoY), the first decline over the past three years. China unexpectedly lost its momentum
in 1Q 2013 with growth falling short of the original forecast of 8% to a recorded increase
of 7.7% YoY. This slowdown occurred despite the government’s commitment to massive
infrastructure spending and the sustained growth in private consumption.
Looking ahead, individual governments in the region are expected to introduce additional
stimulus measures to improve the pace of economic growth. In the leasing market, corporate
tenants will remain largely cost-conscious over the near term until there are more concrete
signs of recovery in global demand, perhaps in the latter half of 2013. Given the low interest
rate environment, the overall sales market is expected to remain dominated by cash-rich
occupiers who are motivated to consider buying for long-term own-use.