Group 1 - FSM Holdings announced the resignation of its auditor, PwC, effective November 7, 2025, due to the involvement of its controlling shareholder, Li Thet, in a multinational money laundering case [3][6] - The U.S. Department of the Treasury's Office of Foreign Assets Control (OFAC) sanctioned Li Thet on October 14, 2025, for his alleged participation in a transnational criminal organization [3][6] - The company paid approximately 343,000 SGD (about 1.87 million RMB) in audit fees to PwC for the fiscal year 2024 [5] Group 2 - Li Thet resigned from his positions as executive director, chairman, and nomination committee chairman of FSM Holdings effective October 21, 2025, to focus on other business commitments [6][12] - Despite his resignation, Li Thet remains the controlling shareholder of FSM Holdings [16] - FSM Holdings is headquartered in Singapore and primarily engages in precision engineering, sheet metal manufacturing, and mobile game development [16] Group 3 - The OFAC identified Li Thet as a key financial assistant to Chen Zhi, the chairman of the Prince Group, responsible for managing illicit funds and cross-border financial flows [16][22] - The Prince Group is accused of using coercive methods to force individuals into cryptocurrency investment scams and money laundering activities [22][26] - The U.S. Department of Justice filed a lawsuit against the Prince Group, targeting 146 entities, including Li Thet and several companies registered in Taiwan [22][26]

Core Viewpoint - Singapore's economy is projected to grow by 2.9% year-on-year in Q3 2025, surpassing market expectations, while the Monetary Authority of Singapore (MAS) maintains its current monetary policy stance to retain flexibility amid future uncertainties [1][3]. Economic Performance - The seasonally adjusted quarter-on-quarter growth for Singapore's economy in Q3 was 1.3%, with an average GDP growth rate of 3.9% for the first three quarters of 2025 [1]. - The manufacturing sector showed mixed results, with a year-on-year output flat at 0.0%, but a significant quarter-on-quarter increase of 6.1%, driven by strong demand for AI-related investments in electronics and precision engineering [2]. - The construction sector experienced a year-on-year growth of 3.1%, although it contracted by 1.2% quarter-on-quarter, indicating a short-term slowdown [2]. - The services sector demonstrated robust growth, expanding by 3.5% year-on-year, supported by demand in wholesale trade, IT services, financial services, and a rebound in international tourism [2]. Market Predictions - Several market institutions have raised their GDP growth forecasts for Singapore in 2025, with DBS Bank increasing its prediction from 2.0% to 3.5%, and Maybank adjusting its forecast from 3.2% to 3.5% [3]. - However, analysts express caution regarding 2026, predicting a slowdown to 1.8% due to adverse factors such as U.S. tariff policies and diminishing export support [3][4]. Monetary Policy - The MAS decided to maintain its nominal effective exchange rate policy unchanged, reflecting a forward-looking stance despite low current core inflation [5]. - The MAS anticipates core inflation to gradually rise to a range of 0.5% to 1.5% by 2026, while the output gap is expected to remain positive in 2025, indicating the economy is operating slightly above its long-term potential [5][6]. - Analysts suggest that maintaining the current policy allows for "insurance easing" options in response to potential economic slowdowns in 2026 [6].

Economic Outlook - Singapore's Ministry of Trade and Industry has revised its GDP growth forecast for 2025 from 0.0%-2.0% to 1.5%-2.5% based on stronger-than-expected performance in the first half of the year [1][2] - The economy grew by 4.4% year-on-year in Q2, slightly up from 4.1% in Q1, with a seasonally adjusted quarter-on-quarter growth of 1.4%, reversing a contraction of 0.5% in Q1 [1] Sector Performance - Growth was primarily driven by outward-oriented sectors such as wholesale trade, manufacturing, financial services, and transportation and warehousing, which engaged in preemptive trade activities in response to impending U.S. tariffs [1][2] - However, the local food and beverage sector experienced a contraction due to increased outbound tourism [1] Future Challenges - The report warns of potential economic slowdown in the second half of 2025, particularly for outward-oriented industries facing weakened demand [3] - The anticipated impact of U.S. tariffs on global end-market demand may lead to reduced growth in the manufacturing sector, although sectors like aerospace engineering and precision engineering may continue to see growth due to ongoing maintenance and refurbishment work [3] - The Ministry will closely monitor global and domestic economic developments and adjust growth forecasts as necessary [3]

Core Insights - Singapore's manufacturing output in June increased by 8% year-on-year, marking the 12th consecutive month of growth and significantly higher than the 3.6% increase in May [1] - Excluding the biomedical manufacturing sector, the output grew by 8.2% year-on-year [1] Manufacturing Sector Performance - Precision engineering saw the highest growth in June, with a year-on-year increase of 18.9%, driven by a 19.3% rise in machinery and systems [1] - The overall output of the precision engineering sector grew by 5.7% in the first half of the year [1] - Biomedical manufacturing experienced an 11.3% year-on-year growth, with the pharmaceutical industry surging by 38.8% due to a low comparison base from the previous year, while the medical technology sector declined by 2.5% [1] - The biomedical manufacturing sector's output grew by 3.0% in the first half of the year [1] Transportation Engineering and Other Sectors - Transportation engineering output increased by 9.2%, with the aerospace sector continuing its upward trend at 20.6%, although the growth rate slowed compared to May [1] - Overall, transportation engineering grew by 16.4% in the first half of the year [1] - The electronics and chemicals sectors reported year-on-year increases of 6.6% and 1.1%, respectively, with the electronics sector's output growing by 7.8% in the first half of the year [1] - The chemicals sector experienced a decline of 1.9% [1] Decline in General Manufacturing - General manufacturing was the only sector to report a decline in June, contracting by 11.6% year-on-year, with only printing output increasing by 2.5% while all other areas saw decreases [1]

Economic Growth - Singapore's economy grew by 3.9% year-on-year in Q1, showing resilience despite global challenges [1] - The manufacturing sector, a key pillar of the economy, grew by 4.0% year-on-year, driven by strong performance in electronics, precision engineering, and transport engineering [1] Wholesale Trade - The wholesale trade sector experienced a 4.2% year-on-year growth, with machinery and equipment being the main growth drivers [2] - The sector benefited from a "rush" phenomenon due to U.S. tariff policies, which led to increased shipments before tariffs took effect [2] Financial and Insurance Sector - The financial and insurance sector grew by 4.5% year-on-year, supported by strong performance in banking and payment services [2] - Singapore's stable and open financial market attracted significant international investment [2] Construction Sector - The construction sector showed robust growth of 5.5% year-on-year, driven by both public and private construction activities [2] - Increased government investment in infrastructure and ongoing private projects contributed to this growth [2] Retail Trade and Consumer Confidence - Retail trade saw a slight increase of 0.1% year-on-year, indicating overall stability in the consumer market [3] - Consumer confidence and employment stability led to increased household spending, supported by government initiatives [3] Services Sector - The services sector grew by 3.6% year-on-year, with information and communication, finance and insurance, and professional services being the main contributors [3] - The acceleration of global digital transformation boosted demand for information and communication technology [3] Labor Market - The unemployment rate remained low at 2.1%, enhancing consumer spending capacity and providing a reliable workforce for businesses [4] - Government initiatives in technology innovation and digital transformation have positively impacted the information and communication sector [4] Policy and Economic Outlook - The government is implementing various policies to stabilize the economy and employment, including infrastructure investment and support for SMEs [4] - Despite strong performance, Singapore must remain vigilant against global economic uncertainties, including trade protectionism and geopolitical risks [4]