Singapore trade and NODX growth forecasts trimmed after further declines in Q3

NON-OIL domestic export (NODX) growth and total trade continued to fall in the third quarter, prompting the government to further trim its total trade and NODX growth forecasts for 2019 to -4.5 to -4.0 per cent and -10.0 to -9.5 per cent respectively.

For 2020, trade promotion agency Enterprise Singapore expects growth of zero to 2.0 per cent for both total trade and NODX.

Enterprise Singapore noted that while the International Monetary Fund expects the global economy to recover modestly with 3.4 per cent growth, the advanced economies expanding at a stable 1.7 per cent and emerging and developing economies growing 4.6 per cent in 2020, there are still "downside risks such as trade tensions, no-deal Brexit withdrawal and deterioration in financial market sentiments" that could hit economic growth next year.

Lower oil prices in a weak global demand situation is also likely to further weigh on Singapore's oil trade in nominal terms and in turn total trade in 2019 and 2020, the trade promotion agency added.

The latest revision in total trade and NODX forecasts came after the adjustments in August when the forecasts for growth for the year were lowered to -3.0 to -2.0 per cent and -9.0 to -8.0 per cent respectively.

Enterprise Singapore's Q3 figures show that NODX sank 9.6 per cent, easing from the 14.7 per cent plunge in Q2. Total trade declined 6.7 per cent in Q3, after a 2.2 per cent drop in Q2.

Total services trade slipped in Q3 to S$124.1 billion, according to Enterprise Singapore.