Singapore said yesterday its economy could suffer even more this year if the spread of Sars in China worsened in coming months.

It said also that China's progress in curbing the virus was critical for the rest of Asia.

"If the Sars situation in China continues to worsen over the next few months, it will dampen China's growth and Asia's economic growth," said Tharman Shanmugaratnam, Senior Minister of State for Trade, Industry and Education.

"It will put at risk even our revised 0.5 to 2.5 per cent GDP growth forecast for this year," he said in a speech.

Singapore halved its forecast for 2003 economic growth on April 17, citing fallout from Severe Acute Respiratory Syndrome which has killed 27 people in the city-state out of 204 reported cases - the world's third-highest death toll from the virus.

China, where the disease is believed to have originated, has been the worst-hit.

The flu-like disease has killed at least 214 people of 4,409 reported cases there, out of 7,000 people infected and almost 500 dead worldwide.

"The progress in fighting the disease in China is critical for the rest of the region," said Shanmugaratnam.

Singapore's rate of Sars infections has tapered off in recent days with only four new cases last week - the smallest number since the epidemic began in March - and Mr Shanmugaratnam expressed confidence that Singapore could bring the virus under control. "We can and we will contain Sars in Singapore. But how large a hit we take to our economy will also depend on how successfully Sars is contained in the region and in Asia," he said.