Singapore’s industrial production rebounded in December and rose at the fastest pace in five months as higher demand for electronics and chemicals offset a drop in pharmaceuticals output.

 

Manufacturing, which accounts for about a quarter of Singapore’s economy, gained 14.4% in December from a year earlier following a revised 9.5% decline in November, the Economic Development Board said today. The median forecast of eight economists surveyed by Bloomberg News was for a 7.4% gain.

 

Singapore’s electronics shipments ended an almost three- year slump last month, even as the government said Jan. 11 that overseas demand may grow at a “sluggish pace.” The island’s dependence on electronics and pharmaceutical exports has made it vulnerable to fluctuations in global demand and business cycles, pushing it into a deeper slowdown than many neighbors last year.

 

“Production seems to be picking up with the improvement in exports and that would be in line with the patterns around the region,” David Cohen, director of Asian forecasting at Action Economics in Singapore, said before the report. “These numbers are always tricky with the volatile pharmaceuticals component.”

 

Singapore’s industrial production rose a seasonally adjusted 18.1% in December from the previous month, when it slid a revised 4.6%.

 

Manufacturing climbed 2.2% in the fourth quarter, more than the 1% gain estimated by the government on Jan. 4, today’s report showed. Production fell 4.1% in 2009, matching the decline in 2008.

 

Electronics production climbed 57.3% last month from a year earlier, following a revised 13.9% gain in November. Electronics make up about 26% of total manufacturing output.

 

Pharmaceutical production, which accounts for about 20% of manufacturing, slipped 16.3% after declining a revised 52.6% in the previous month. Excluding biomedical manufacturing, production gained 23.9% in December.

 

Production may rise in the coming months as more companies open plants in Singapore. Royal Dutch Shell Plc opened a monoethylene glycol plant in Singapore last quarter, while Renewable Energy Corp., a Norwegian maker of solar-power components, is scheduled to start production in Singapore this year.