S’pore records surprise export growth

Singapore’s docks had not been expecting an increase in traffic. Source: Wikimedia 

Singapore’s exports jumped unexpectedly last month as sales to major markets such as the EU and China rose, but it is not expected to prevent the city-state avoiding another year of declining exports. 

Non-oil domestic exports (NODX) grew 11.5 per cent year-on-year last month, thanks to stronger shipments of non-electronics and electronics, the International Enterprise trade agency announced.

Singapore exports have been stuck in negative growth for most of 2016 and a central bank poll of market analysts forecast NODX to contract 4.4 per cent this year, worse than an earlier prediction of 3.6 per cent.

There was a significant 12-per-cent contraction in October. NODX totalled S$13.9 billion in November, higher than the S$12.3 billion registered in October.

November’s exports would not “change the fate of a fourth full-year of decline”, said UOB market analyst Francis Tan. He forecast that NODX would “finally break the contractionary barrier and grow 0.7 per cent in 2017, although it is still a very weak growth”.

The authorities anticipated a NODX contraction of between 5 to 5.5 per cent.

November’s exports got a boost from shipments of electronic products, which increased by 3.5 per cent year on year, in contrast with October’s 6-per-cent decline fall. The increase was largely due to integrated circuits, computer parts and disc-media exports.

In November, shipments to Singapore’s top 10 markets increased, except for Japan, Thailand and Indonesia. The largest contributors to NODX was the EU (which rose by 48.3 per cent), Hong Kong (up 38.1 per cent) and China, with an increase of 15.9 per cent.

CIMB analyst Song Seng Wun warned that any recovery was fragile as he “still sees unevenness”.

“Consumers are still selective. If we look at December’s PMIs, it looks like economic activities in developed markets have picked up. If it is sustained for the coming next quarter, we will likely see the recovery in exports gather speed. But there are still a lot of headwinds. The unpredictability of ‘President-elect’ Donald Trump’s policies could still see uncertainty in consumption,” Song said.

And Credit Suisse analyst Michael Wan said it was still too early to tell if the November figures pointed to a sustained improvement. He said that electronics manufacturers had turned in a few months of stronger numbers and appeared to be doing better going into next year.