SINGAPORE'S exports are expected to rebound in the next five years on economic and trade rejuvenation of emerging markets within Asia, specifically the country's key business partners, China, Malaysia and Indonesia.
Singapore's exports in 2015-2020 are projected to grow by 3.9 per cent per annum globally and 5 per cent per annum within Asia (ex Japan), based on the latest HSBC Trade Forecast, which is a half-yearly report by Oxford Economics that is commissioned by HSBC. The report provides an outlook on the five-, 10- and 15-year trade activity of 25 major economies, including Singapore.
The latest trade forecast figures for Singapore are significantly higher than the country's recent export growth of 1.1 per cent over 2013 and 2014.
HSBC Singapore's head of global trade and receivables finance, Joe Arena, said: "While a short-term trade boost is expected from the increasingly robust US economy, and cyclical upturns in Europe and Japan, the demographic trends in Asian emerging markets are likely to be the trade kicker from 2017 onwards - and Singapore is set to benefit."
The report also reveals that China replaced Malaysia as Singapore's top export destination in 2014, and that Vietnam will emerge as a top five export partner for Singapore over the next 15 years, replacing the US.
The report also focused on Singapore's ICT (information and communications technology) sector. Singapore's ICT exports are predicted to grow by 6 per cent per annum over 2015-2030 and imports to grow by 8 per cent per annum over the same period.
Despite Singapore's shifting balance of trade within ICT - from exports to imports - reflecting the move of ICT manufacturing to lower-cost economies, HSBC Trade Forecast notes that Singapore is well positioned to remain a global player in ICT trade, citing that the city-state is the highest ranked globally in the World Economic Forum's annual Networked Readiness Index, which indicates a country's ability to exploit the opportunities offered by ICT.
Singapore will remain a top five contributor of ICT trade globally, the report noted.
The country is seeking to position itself as a "smart country", by encouraging companies to invest and set up their head offices here, Mr Arena said. He added: "Practically speaking, we are seeing ICT businesses in Singapore move up the value chain by shifting production to lower-cost manufacturing economies in the region but centrally retaining their intellectual property, sales, distribution and decision-making in Singapore.
"Embracing the trade and economic realities of the region further demonstrates Singapore playing to its strengths as a financial trade hub and remaining strategically significant in the ICT sector."