Non-oil exports inch up, beating forecasts

Singapore exports received a shot in the arm last month thanks to strong electronics shipments, surprising economists who had expected a much poorer showing given the slow global growth.
Singapore exports received a shot in the arm last month thanks to strong electronics shipments, surprising economists who had expected a much poorer showing given the slow global growth. PHOTO: ST FILE

Singapore exports received a shot in the arm last month thanks to strong electronics shipments, surprising economists who had expected a much poorer showing given the slow global growth.

However, economists warned that it is too early for optimism.

Not only may Singapore have still fallen into a technical recession in the third quarter, but exports are also unlikely to recover decisively in the coming months, they said.

Non-oil domestic exports inched up 0.3 per cent in September over the same month last year, easily beating economists' estimates of a 3.9 per cent fall as well as August's dismal 8.4 per cent slide.

Electronics were the bright spot in September's export data, with shipments rising by 5.7 per cent over the same month last year largely owing to integrated circuits, PCs and telecommunications equipment.

Non-electronics shipments decreased 1.9 per cent, dragged down by petrochemicals, printed matter and primary chemicals.

Non-oil domestic exports to five of Singapore's top 10 markets expanded in September, led by Japan, Thailand and Indonesia. Shipments to mainland China, the United States, South Korea, Taiwan and the European Union fell.

Economists say yesterday's trade numbers offer a glimmer of hope that Singapore's economy did better than previously estimated in the July to September quarter.

Advance estimates released on Wednesday showed that Singapore managed to escape a technical recession in the third quarter.

The economy grew 1.4 per cent in the three months to September over the same period a year earlier, and 0.1 per cent from the April to June quarter.

A technical recession is defined as two consecutive quarters of decline in economic output.

The final statistics due out next month may still reveal a third-quarter technical recession, with the economy dragged down by increasingly downbeat global sentiment.

While yesterday's export numbers were better than expected, OCBC economist Selena Ling said this may not necessarily translate into more robust growth numbers.

Manufacturing data for September, due on Oct 26, will give a clearer indication of the performance of the industry, she added.

UOB economist Francis Tan said the world economy still lacks a strong driver and there are no signs of an export recovery.

"There's now more pessimism about China, Singapore's largest trading partner, ahead of the upcoming release of its economic growth numbers."

A version of this article appeared in the print edition of The Straits Times on October 17, 2015, with the headline 'Non-oil exports inch up, beating forecasts'. Print Edition | Subscribe