SINGAPORE, Jan 2 (Reuters) - Singapore's economy shrank at a seasonally adjusted, annualised pace of 12.5 percent in October to December, pushing the economy into its deepest recession since 2001.
The economy has contracted for three straight quarters as the trade-reliant island felt the impact of the global financial crisis, which pushed some of Singapore's major export markets, including the United States, Japan and the euro zone, into recession.
From a year ago, gross domestic product fell 2.6 percent following a drop of 0.3 percent in the third-quarter, advance estimates from the Ministry of Trade and Industry showed.
The economy grew 1.5 percent for all of 2008, compared with 7.7 percent in 2007.
Singapore last reported three straight quarters of economic contraction in 2001 when the city-state was hammered by the bursting of the dotcom bubble.
The latest annualised fall in GDP follows declines of revised 5.4 percent in July-September and 5.3 percent in April-June.
Singapore's manufacturing sector shrank 9 percent in the fourth quarter from a year ago, while construction grew 13.3 percent and services rose 1.1 percent.
Prime Minister Lee Hsien Loong warned in his New Year message on Wednesday that the global financial crisis had hit the island hard and that the economic outlook was uncertain.
"We must therefore prepare for a difficult year ahead, and especially the first half of 2009. Our economy will probably contract further," he said. [ID:nnSIN391136]
Singapore reports advance GDP data based largely on information from the first two months of the quarter, and follows up with detailed GDP numbers for the period about five to six weeks later.
(Reporting by Kevin Lim; Editing by Neil Fullick)