Singapore key exports tumble 14.7% in May

SINGAPORE: Singapore’s key exports fell for the eighth straight month in May and at a steeper rate, raising the risk of a technical recession.

Non-oil domestic exports (Nodx) shrank 14.7% year-on-year (y-o-y) in May, after a 9.8% contraction in April, data from Enterprise Singapore (EnterpriseSG) shows.

The result was much worse than the 7.7% fall expected by economists in a Bloomberg poll.

In real terms after adjusting for inflation, Nodx decreased by 7.6%, following the 3.1% fall in April, EnterpriseSG said.

Maybank economist Chua Hak Bin said “the export slump is worsening and Singapore is now at greater risk of a technical recession”.

A technical recession is when an economy contracts for two consecutive quarters. Singapore’s economy shrank 0.4% on a quarter-on-quarter basis in the first quarter of 2023.

DBS Bank economist Chua Han Teng pointed to the difficult global external environment faced by exports and the manufacturing sector, particularly for electronics.

He said the latest numbers show that Singapore’s electronics exports slump has yet to reach bottom.

Electronics shipments were the biggest drag on May’s Nodx, tumbling 27.2% y-o-y in May, a sharper contraction than the 23.3% plunge in April.

Integrated circuits, disk media products and parts of integrated circuits contributed the most to the decline, with the last segment seeing the sharpest fall of 48.7%.

“The near-term outlook for electronics exports remains uncertain, given that inventory de-stocking, for example in the global semiconductor market, is still ongoing,” Chua said. — The Straits Times/ANN