Credit-search data points to rise in trade between Singapore and East Asia

Singapore

SINGAPORE companies are trading more with East Asia, going by data on credit searches made by homegrown firms on companies from that region.

Asean remains the single largest trading bloc for Singapore companies on this front - but just barely.

Credit searches on East Asian companies rose visibly in proportion, going from 20.6 per cent in 2015 to 26.7 per cent last year, said the Singapore Commercial Credit Bureau.

In East Asia, companies from China, Hong Kong and Japan were the subject of most such checks done by Singapore companies.

Figures from IE Singapore backed this up, with merchandise trade with Hong Kong and Japan having risen 4.3 per cent and 4.5 per cent year on year (yoy) respectively. Non-oil domestic exports (NODX) to Hong Kong, for example, rose by a significant 19.8 per cent last year. This strong run is continuing: March 2017 NODX was up 16.5 per cent yoy, extending the growth in the preceding four months, with the growth in NODX coming from the increase in both electronics and non-electronics NODX.

NODX to all of the top 10 markets went up, led by China, Taiwan and Hong Kong.

Meanwhile, the Asean region accounted for the highest proportion of overseas credit searches by Singapore firms in 2016 for the fourth consecutive year, said the bureau.

However, there was a notable fall in the proportion of Asean credit searches by local firms - from 2015's 36.5 per cent to 27.2 per cent last year.

As with 2015, Malaysia, Indonesia and Thailand were Singapore companies' most-searched-on markets. IE Singapore said they remained as Singapore's top Asean trading partners last year.

Weakening global trade in 2016 has dampened the number of foreign credit searches by Singapore companies; the overall number fell for the third year running.

Overseas credit searches by local businesses fell by 1.2 per cent in 2016, though this was a decelerated decline from 2015, when the number of overseas credit searches fell by 19.1 per cent.

Total trade shrank by 4.9 per cent in 2016, moderating from the 8.9 per cent decrease in 2015. NODX and non-oil re-exports (NORX) also took a dip in 2016, falling by 2.8 per cent and 3.1 respectively.

Credit searches made by foreign companies on Singapore firms also dipped between 2015 and last year, by 1.2 per cent. This was the result of a sharp drop in searches by Europe, though this was mitigated by a big jump from East Asia.

As with 2015, Europe accounted for the most credit searches done on Singapore companies, followed North America and East Asia.

Searches by European companies fell sharply from 37.3 per cent in 2015 to 26.6 per cent last year; searches by East Asian firms rose from 16.6 per cent in 2015 to a fifth (21.1 per cent) last year. Japan, Hong Kong and China were the top three East Asian markets that ran the most searches on Singapore firms.