SINGAPORE – Singapore’s non-oil domestic exports (Nodx) grew by 3 per cent in February year on year, beating economists’ expectations of another drop amid the coronavirus crisis.
Analysts polled by Bloomberg had forecast a 4.6 per cent decline in Nodx, after shipments shrank 3.3 per cent in January.
But on a month-on-month seasonally adjusted basis, Nodx dropped 4.8 per cent in February compared with January. Non-electronic domestic exports declined while shipments of electronics grew, the ESG said. The level of Nodx reached $14 billion last month, compared with the $14.7 billion in January.
SIM Global Education senior lecturer Tan Khay Boon said that the decline in the seasonally-adjusted month-on-month figures shows that demand for exports from Singapore was still weak.
Dr Tan said: “The improvement in (last month’s year-on-year figures) was a more technical one due to the low base in 2019.”
He added: “With more and more countries enforcing a lockdown due to the Covid-19 outbreak, external trade is bound to weaken with weaknesses in both demand and supply.”
Still, not all is bleak. Barclays Bank economist Brian Tan said: “Beyond the expected favourable base effect from the earlier Lunar New Year holiday this year, the sequential decline was also milder than we had anticipated.”
In February, exports of electronics grew by 2.5 per cent from a year ago, while exports of non-electronics expanded 3.2 per cent in the same period, according to Enterprise Singapore data on Tuesday (March 17).
Parts of integrated circuits, capacitors and disk media products led the export growth in electronics.
Export of integrated circuits grew 130.9 per cent while capacitors increased 128.8 per cent. Exports of disk media products grew 57.4 per cent. Electronic exports had fallen 13 per cent in January.
For non-electronic exports last month, specialised machinery, non-electric engines and motors and pharmaceuticals were the best performers. Exports of specialised machinery grew 74.1 per cent while non-electric engines and motors increased 37.3 per cent. Pharmaceuticals grew 23.7 per cent. Non-electronic exports had fallen 0.1 per cent in January.
Nodx to the Singapore’s top markets mostly increased, other than for China and Hong Kong.
Exports to the European Union bloc, including Britain, grew 43 per cent and exports to the United States, the world’s largest economy, grew 23.5 per cent. Exports to Japan grew the most by 61.7 per cent last month.
Nodx to China fell 35.8 per cent – the lowest in four years – and Nodx to Hong Kong fell (29.2 per cent) for the 10th straight month.
Maybank Kim Eng economists Chua Hak Bin and Lee Ju Ye said: “Despite the positive headline number, Nodx to China plunged due to closure of ports as part of the (Covid-19) lockdown.”
Dr Tan said: “Some amount of depreciation in the Singapore dollar may help to boost exports, but the external weak demand will continue to persist until Covid-19 is well within control.”
Dr Chua and Ms Lee concurred, saying: “We doubt that February’s better-than-expected numbers will extend into March.”
“The rapid spread of the virus outbreak in Europe and US will likely hurt global demand. The recent spike in Covid-19 cases in neighbouring countries including Malaysia, Indonesia and Thailand, is triggering more drastic government measures and will dampen regional trade.”
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