Growth in Singapore key exports seen slowing to 0%-2% in 2026 on US tariff impact

SINGAPORE – The growth in Singapore’s key exports is expected to moderate in 2026 to 0 per cent to 2 per cent as the tariff impact materialises and front-loading eases, Enterprise Singapore said on Nov 21.

The trade agency also narrowed its 2025 forecast for growth in non-oil domestic exports (NODX) to around 2.5 per cent, from its previous forecast range of 1 per cent to 3 per cent.

Economists said that the latest official forecasts lean towards a more cautious outlook.

In its quarterly review of trade performance, EnterpriseSG noted that the World Trade Organization expects global trade growth to fall to 0.5 per cent in 2026 from 2.4 per cent in 2025.

“This slowdown primarily reflects the materialisation of tariff-related impact and the easing of front-loading effects,” said the agency.

“Downside risks include potential re-escalation of tariff actions as well as sector-specific tariffs that could raise global economic uncertainty and dampen demand,” it added.

OCBC Bank chief economist Selena Ling said the bank has upgraded its full-year NODX growth forecast to 4 per cent. Its 2026 NODX growth forecast remains at 1 per cent to 3 per cent, given the high base in 2025.

Commenting on the latest official forecasts, Ms Ling said NODX growth could exceed 2.5 per cent for 2025.

“To get to 2.5 per cent for the full year, when January to October is already at 4.1 per cent, there will be a need for November to December NODX to fall by around 11 per cent year on year (or 5.5 per cent a month), which is unlikely,” she said.

CGS International economist Mohamed Afham Zulghafir said the firm forecast 2025 NODX growth to come in at around 3.3 per cent year on year.

“Based on their (EnterpriseSG’s) calculations, the November to December 2025 average would be minus 7.5 per cent year on year. Instead, we forecast NODX (growth) to average this year at 3.3 per cent year on year, implying an average of minus 3 per cent this November to December,” he said.

He said electronics exports will continue to benefit from artificial intelligence-related demand.

Singapore should also gain from regional market demand across both electronics and non-electronics segments, helping to offset weaker demand from the US, he said.

Front-loading of exports to the US, while slowing, could still continue as sectoral tariffs have yet to be finalised, he added.

The financial services firm also expects 2026 NODX growth to come in at 3.5 per cent year on year.

“Our numbers reflect expected resilience in electronics exports but also recognise that more volatile external demand could lead to periodic softness,” he said, referring to factors such as prolonged US-China trade tensions and softer growth in key trading partners.

In the third quarter, Singapore’s key exports fell 3.3 per cent from a year ago after a 7 per cent increase in the second quarter.

Non-electronics shipments shrank, while electronics grew at a slower pace.

Exports of electronic products grew 7.1 per cent year on year. Personal computers expanded 69.5 per cent, integrated circuits grew 9.2 per cent, while disk drives were up 16.5 per cent.

Non-electronics shipments fell 6.5 per cent in the third quarter, dragged down by food preparations (minus 39.4 per cent), petrochemicals (minus 21.2 per cent) and pharmaceuticals (minus 9.3 per cent).

Key exports to the US tumbled 30.7 per cent, while those to Indonesia dropped 29.3 per cent. NODX to China fell 8.3 per cent.

The Ministry of Trade and Industry announced on Nov 21 that Singapore’s gross domestic product growth forecast for 2025 has been upgraded from “1.5 per cent to 2.5 per cent” to “around 4 per cent”. It largely reflects the better-than-expected performance of the Singapore economy in the third quarter of 2025.

But growth is expected to slow to 1 per cent to 3 per cent in 2026.