Singapore's exporters expect trading conditions to improve over the next six months, according to an index of trade confidence that has jumped to its highest level in two years.
Half of the respondents to a survey conducted by HSBC said they believe trade volumes will rise in the next half-year. This was up from 40 per cent in a similar survey conducted six months ago, HSBC said in a press release on Tuesday.
It added that this confidence stems from an anticipation of higher global demand, especially in key markets. Exporters are also counting on some large orders in the pipeline.
"The Singapore government's growing emphasis on raising research and development spending and innovation will enhance the country's competitiveness, ensuring that it remains a key hub for financial services as well as a trading port for the rest of Asia," said Mr Joseph Arena, head of trade and receivables finance at HSBC Singapore.
But while Singapore's export-orientated economy will benefit from a gradual improvement in global trade this year, overall GDP growth is "likely to be constrained by weak housing investment and modest growth in household consumption", said HSBC.