Singapore key exports rise 9.3% in January as AI demand fuels electronics shipments

SINGAPORE – Singapore’s key exports saw further gains in January as electronics shipments surged on strong demand related to artificial intelligence (AI).

Analysts cautioned that there may be some volatility in the first quarter of 2026 owing to the Chinese New Year festive period in February, but remained optimistic that overall exports will continue to be bolstered by global AI-related tailwinds.

Non-oil domestic exports (NODX) expanded 9.3 per cent, extending from the 6.1 per cent increase in December, according to figures released by Enterprise Singapore on Feb 16.

The increase, though, fell short of the 13.5 per cent rise forecast by analysts in a Bloomberg poll.

Electronics exports jumped 56.1 per cent, albeit from a low base a year ago, with Chinese New Year falling in January in 2025. Electronics NODX stood at $3.1 billion that month, below the 2025 monthly average. Integrated circuits exports expanded the most, at 80.5 per cent, while disk media products rose 70.2 per cent, and PC exports rose 24 per cent.

Non-electronics NODX dropped 3 per cent year on year in January, after a rise of 0.8 per cent in December. The declines were across specialised machinery, food preparations and petrochemicals.

In terms of markets, exports to China, Hong Kong and Europe rose the most compared with a year ago, while exports to Indonesia and the US contracted.

Mr Chua Han Teng, senior economist at DBS Bank, noted robust electronics exports to key upstream players South Korea, with 69.4 per cent growth, and Taiwan, with 111.5 per cent growth. He said the strong global AI-related demand for Singapore’s memory chips and server-related products has allowed the Republic to benefit indirectly from integrating into the AI ecosystem.

Non-electronics exports to the US slumped 57.3 per cent, worsening from December’s 47.2 per cent contraction, which could point to some weakness in domestic consumer demand conditions, said Ms Selena Ling, chief economist and head of group research at OCBC Bank.

A 17.9 per cent contraction in non-electronics exports to Indonesia suggested a soft patch in consumer demand, she added.

In contrast, non-electronics exports to Thailand grew 67.6 per cent, and those to the euro zone expanded 47.6 per cent.

Looking ahead, she predicted that February’s exports are likely to contract 0.4 per cent year on year owing to the Chinese New Year festive period, but this should rebound to 3.5 per cent in March to bring key exports growth in the first quarter of 2026 to 4.3 per cent.

The superior performance of electronics exports, relative to weaker non-electronics shipments, could persist in the near term, offsetting any volatility arising from the festive period, said DBS’ Mr Chua.

“Electronics exports momentum should remain supported by sustained global AI-related tailwinds and demand for the city’s server products and memory chips, while non-electronics NODX could face downside pressures from the lingering and lagged impact of higher US tariffs globally.”

He noted that new export orders for electronic products in Singapore’s electronics purchasing managers’ index (PMI) rose further in January, returning to levels last seen in February 2025.

In contrast, new export orders in the headline manufacturing PMI remain weaker and have yet to recover to the reading in March 2025, before US President Donald Trump’s global tariffs on April 2.

Non-electronics products like pharmaceuticals may continue to see support but remain more sensitised to cyclical changes in global demand, while gold is subject to market sentiment fluctuations, said Ms Ling.

EnterpriseSG last week raised its forecast for key exports in 2026 in response to an improved global economic outlook, especially for AI demand. NODX is expected to grow 2 per cent to 4 per cent in 2026, up from the previous forecast of 0 per cent to 2 per cent in November.