Singapore exports grow faster

Maybank Kim Eng Securities analyst Lee Ju Ye said Singapore’s Nodx has risen by 5.9% in the year to date, in contrast to the plunge seen during the global financial crisis of 11% in 2009. Nodx dropped 14% in 2001 in the wake of the recession caused by the dot.com bus

SINGAPORE: Growth in Singapore’s non-oil domestic exports (Nodx) picked up last month, with shipments increasing 7.7% year on year, mainly driven by non-electronic goods, according to data from Enterprise Singapore (ESG) yesterday.

August’s increase was more than double the 3.3% expansion forecast by private analysts in a Bloomberg survey.

Nodx has now risen in six out of the eight months of this year, a robust performance when compared with only one month of gain last year. Nodx growth also picked up pace on a three-month moving average year-on-year basis, rising 9% after a 4.6% gain in July.

The gain in July’s Nodx was revised down to 5.9%, from 6%. Shipments were up 13.9% in June after a 4.6% drop in May.

Maybank Kim Eng Securities analyst Lee Ju Ye said Singapore’s Nodx has risen by 5.9% in the year to date, in contrast to the plunge seen during the global financial crisis of 11% in 2009. Nodx dropped 14% in 2001 in the wake of the recession caused by the dot.com bust.

“While the Covid-19 pandemic has resulted in significant disruption to people flows due to lockdowns and border controls, the impact on manufacturing supply chains and trade flows has been much less severe, ” she said.

Lee said that with global and regional manufacturing gauges having normalised to pre-pandemic levels in August, the resilience in exports bodes well for Singapore, given its role as a regional trading and transport hub.

“We are, however, mindful of the downside risks, including a resurgence of Covid-19 infections in parts of Europe, and intensifying US-China tensions that could disrupt global supply chains, ” she noted.

ESG data showed shipments of non-monetary gold, specialised machinery and food preparations led August’s gains, followed by electronic exports.

Non-electronic Nodx rose by 8.3% in August, following the 6.9% growth in the previous month.

Domestic exports of non-monetary gold have gained momentum this year amid hoarding of physical gold as a safe-haven asset in view of the global economic uncertainty induced by the coronavirus pandemic. Electronic shipments were up 5.7%, following the 2.8% increase in July. Integrated circuits or chips, disk media products and personal computers grew by 7.1%, 11.8% and 15.2% respectively, contributing the most to the growth in electronic Nodx.

According to ESG, domestic chip exports accounted for 64% of electronic Nodx growth in August, after declining by 32.1% in August 2019 amid the global electronics downcycle.

Sung Eun Jung, a Singapore-based economist at Oxford Economics, said while resilience in Nodx throughout the pandemic has been noteworthy, re-exports have been much weaker and more uneven.

ESG data showed non-oil re-exports rose 0.1% year on year in August, after the 3.1% decline in July.

“The prospects for a continued recovery in re-exports are more uncertain as countries around the world still grapple with Covid-19, ” Jung said.

Nodx to Singapore’s top markets as a whole grew in August, though exports to Indonesia, Hong Kong, Malaysia and Thailand declined. The largest contributors to the Nodx growth were China, the EU27 and the United States. — The Straits Times/ANN