Exports rebound in November, but outlook stays weak

Singapore’s exports rose below expectations last month as demand in major markets and the key electronics sector weakened further, signalling a challenging outlook for trade-dependent businesses next year.

Non-oil domestic exports (NODX) expanded 1.6 per cent in November from a year earlier, rebounding from a 1.5 per cent contraction in the previous month, data released by International Enterprise (IE) Singapore showed yesterday.

The headline figure was far below a median forecast of a 3.7 per cent gain in a Reuters poll of economists.

The non-electronics segment rose 7.5 per cent on-year last month, led by growth in pharmaceuticals, printed matter as well as heating and cooling equipment.

In contrast, the electronics segment fell for a 28th consecutive month, with shipments declining 10.2 per cent.

The outlook for the electronics sector is set to remain bearish, said economists.

“The competitiveness challenge in the domestic electronics industry continues to mount. The semiconductor book-to-bill ratio sank further below the key 1x threshold for the second straight month to 0.93,” said Ms Selena Ling, head of treasury research and strategy at OCBC Bank.

Shipments to all of Singapore’s top 10 markets — except for Malaysia, Indonesia and Thailand — fell last month due to the slowdown in several key economies.

“By and large, we are not too optimistic on the eurozone. We expect modest growth and outlook for the developed markets,” said UOB senior economist Alvin Liew.

IE Singapore had forecast NODX to contract between 1 and 1.5 per cent this year and gain between 1 and 3 per cent next year on the back on a modest pickup in global growth.

“The outlook for 2015 continues to look slightly underwhelming at this juncture and we see a possibility that Singapore’s 2015 NODX growth could undershoot IE Singapore’s NODX forecast,” said Ms Ling. Angela Teng