Singapore's non-oil domestic exports up 4.7% on year in June, but month-on-month decline continues

Non-oil domestic exports (NODX) in Singapore grew 4.7 per cent year-on-year in June compared to a decline of 0.3 per cent the previous month.
Non-oil domestic exports (NODX) in Singapore grew 4.7 per cent year-on-year in June compared to a decline of 0.3 per cent the previous month. PHOTO: ST FILE

SINGAPORE - Non-oil domestic exports (NODX) in Singapore grew by a better-than-expected 4.7 per cent year-on-year in June, on stronger shipments to the US and China, data released by International Enterprise (IE) Singapore on Thursday showed.

That topped a 2.0 per cent expansion forecast in a Reuters survey of economists, as both electronic and non-electronic shipments increased in June.

It also reversed a drop in May, when NODX contracted a revised 0.3 per cent year-on-year as sales to Europe and China declined.

But analysts noted that shipments were down for a third consecutive month on a month-on-month basis. NODX for June declined 2.4 per cent when compared to May, while May saw a 3.3 per cent month-on-month contraction.

Said DBS senior economist Irvin Seah: "Despite the encouraging year-on-year figure, the sequential decline of 2.4 per cent month-on-month is a concern. Note this follows a 3.3 per cent slide in the previous month. That is, the low base has helped in lifting the year-on-year figure but in effect, export sales are still slipping."

Mr Seah said that beyond the rising external headwinds and global uncertainties, Singapore manufacturers are also struggling with the triple whammy of higher business costs, labour crunch and a strong currency. While manufacturers are finding it difficult to take on new orders given supply side constraints, they are also losing their price competitiveness to regional players, he said.

"For example, electronics exports in Singapore have been stuck in the doldrums for the past three years," said Mr Seah. "This has allowed emerging electronics manufacturers such as Vietnam to catch up. In fact, Vietnam will overtake Singapore to become the fifth largest electronics exporter in Asia within the next two years."

IE Singapore's June data showed that electronic exports grew 7.6 per cent on-year, following a 2.5 per cent decline in the previous month. The increase was largely due to PCs (+69.6 per cent), ICs (+10.8 per cent) and telecommunications equipment (+79.3 per cent).

Non-electronic exports expanded by 3.6 per cent, following the 0.6 per cent rise in the previous month. The growth was led by electrical machinery (+75.0 per cent), printed matter (+35.8 per cent) and non-electric engines & motors (+281.8 per cent).

On a year-on-year basis, NODX to all of the top 10 NODX markets, except Indonesia, Malaysia and Taiwan, rose in June. The top contributors to the NODX were the US (+ 32.2 per cent), China (+12.2 per cent) and Thailand (+23.6 per cent).