Singapore exports took a tumble in the second quarter, shrinking by 14.6 per cent on the back of slowing global demand for electronics and sluggish trade conditions.
This was a sharp fall from the 6.4 per cent contraction in non-oil domestic exports (Nodx) in the first three months of the year, according to Enterprise Singapore (ESG) data released yesterday.
It also marked the third consecutive quarter of negative year-on-year Nodx growth.
With global economic and trade growth expected to moderate further this year, the Republic yesterday slashed its Nodx projection for the year again to between -9 per cent and -8 per cent, down from -2 per cent to 0 per cent growth previously.
Both electronic and non-electronic Nodx have declined, contributing about half each to the Nodx drop to date, said ESG.
Electronic products formed about a quarter of such exports last year, with non-electronics making up the rest.
Looking ahead, ESG said the International Monetary Fund has revised its global economic growth forecast to 3.2 per cent from 3.3 per cent. The growth outlook for Singapore's key trade partners, such as China and Japan, was adjusted downwards as well.
These were among ESG's considerations for the revision.
In the second quarter, exports of electronic products contracted 26.9 per cent due to drops in integrated circuits, disk media products and personal computers.
Non-electronic shipments fell 10.5 per cent in the second quarter compared with a year ago, due to decreases in civil engineering equipment parts, non-monetary gold and petrochemicals.
Nodx to Singapore's top 10 markets except the United States also fell in the April to June period, mainly due to decreases in exports to China, Europe and Japan.
The total merchandise trade forecast for this year was also revised downwards to between -3 per cent and -2 per cent yesterday.
Maybank Kim Eng economist Chua Hak Bin said that the Nodx downgrade "pretty much assumes that there will be hardly any recovery, or very weak recovery, in the second half".
"The light at the end of the tunnel still looks rather dim," he added.
DBS senior economist Irvin Seah said that the downward revision in Nodx does not come as a surprise, given that it has been dropping at a double-digit pace for many months.
"We need to be mindful about next year's growth and ensure that there is enough support for companies and workers, going forward," he said.
OCBC Bank head of treasury research and strategy Selena Ling said there is a possibility that Nodx for the year could see its worst performance since 2009, when it contracted 10.5 per cent year on year.
This is "assuming that protracted trade uncertainties and the regional growth slowdown do not abate in the near future".