Exports rebound by 8.2% after 2 months of flat performance
SINGAPORE — Non-oil domestic exports (Nodx) grew by 8.2 per cent last month from the same month last year to a seasonally-adjusted S$14.5 billion, following the flat performance in the preceding two months, according to data by trade agency International Enterprise (IE) Singapore released on Monday (July 17).
Overseas shipments expanded by 0.4 per cent in May and contracted by 0.3 per cent in April, following five months of growth since November.
The expansion last month came from both electronic and non-electronic shipments, with the electronics sector clocking in its eighth straight month of growth.
On a year-on-year basis, electronic Nodx increased by 5.4 per cent in June, following the 28.9 per cent expansion in the previous month. Integrated circuits led the way, growing by 20.7 per cent.
Non-electronic products grew by 9.3 per cent last month, in contrast to the 8.6 per cent decline in the previous month.
“We still maintain our positive outlook on the overall Nodx expansion for 2017, supported by continued growth in electronics exports. However, we do not expect the strong double digit Nodx growth since November 2016 can be sustained into the second half of the year. This is especially since the current electronics cycle may be coming towards an end with the rolling out of the next wave of smartphones likely in the second half,” said UOB economist Mr Francis Tan.
According to a preliminary report by IT research firm Gartner released last week, shipments of personal computers in the Asia-Pacific region slumped by 5.1 per cent in the second quarter from the corresponding period a year earlier, declining at a faster pace than global shipments, which contracted 4.3 per cent over the same period.
A bright spot in last month’s exports was the expansion in non-electronic shipments.
Non-monetary gold, specialised machinery and petrochemicals increased by 148.0 per cent, 76.1 per cent and 13.7 per cent respectively, contributing the most to the growth in non-electronic Nodx.
“While the petrochemical exports performance is encouraging, the non-monetary gold and machinery exports may be fairly chunky and volatile. As such, we are still looking for a sustained broadening of the Nodx growth drivers beyond electronics,” said Ms Selena Ling, head of treasury research and strategy at OCBC Bank.
On a month-on-month seasonally adjusted basis, Nodx declined by 2.7 per cent last month, after the previous month’s 9.4 per cent increase, as according to IE Singapore, the decline in electronic Nodx outweighed the increase in non-electronic shipments. The Nodx at S$14.5 billion last month was down from the S$14.9 billion the previous month.
According to CIMB Private Bank economist Song Seng Wun, Singapore’s export outlook remains positive, given China’s economic growth turning out to be better than expected, the United States economy holding steady and the European Union (EU) anchored by Germany holding up.
“The regional markets have also been positive. The pull-back in Indonesia and Malaysia were a temporary blip, considering the fasting period in June,” Mr Song added.
Exports to the top markets China, South Korea, Japan, Malaysia and Hong Kong rose, outweighing the declines to the US, Taiwan, the EU, Thailand and Indonesia.
The largest contributors to the Nodx increase were China (+48.9 per cent), South Korea (+56.9 per cent) and Japan (+26.7 per cent).
Shipments to China expanded by 48.9 per cent last month, following the previous month’s increase of 39.0 per cent, led by non-monetary gold, integrated circuits and petrochemicals.
Clarification: In an earlier version of this report, we stated that Singapore’s exports rebounded by 8.2 per cent after two months of decline. IE Singapore has clarified that revised figures indicate that the performance in April and May was flat.