The Business Times

Singapore upgrades 2022 trade forecast again amid higher forecast for oil and electronics trade

Sharon See
Published Thu, Aug 11, 2022 · 08:18 AM

SINGAPORE on Thursday (Aug 11) significantly upgraded its full-year trade forecasts for the second time this year as second-quarter performance, driven by oil and electronics trade, turned out to be better than expected.

Total merchandise trade is now projected to grow 15-16 per cent in 2022, instead of 8-10 per cent, according to Enterprise Singapore (EnterpriseSG).

The growth projection for non-oil domestic exports (NODX) has been bumped up to 5-6 per, from 3-5 per cent.

These projections were last upgraded when EnterpriseSG released Q1 trade performance in May.

“Since the last update, both total merchandise trade and NODX grew better-than-expected in Q2 2022. Higher oil prices and robust global semiconductor demand are likely to continue in 2022,” said the agency.

“These should support growth in oil trade in nominal terms and NODX respectively, and in turn total trade.”


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But it added that uncertainty remains, with inflation, a sharper-than-expected slowdown in China and further spillover effects from the Russia-Ukraine war remaining key risks.

EnterpriseSG noted that the oil price forecast for 2022, at US$105 per barrel, is nearly 50 per cent above the 2021 price of US$71 per barrel, and prices are expected to remain elevated for the rest of 2022 as the global energy supply remains uncertain amid the Russia-Ukraine war.

Global semiconductor revenue is also expected to be 7.4 per cent higher year on year in 2022, said the agency, citing Gartner’s July data.

This comes as total merchandise trade jumped 28.1 per cent year on year in Q2, extending the 20.8 per cent growth in the previous quarter.

Oil trade surged 69.5 per cent year on year in Q2, higher than the previous quarter’s 48.2 per cent expansion. Non-oil trade rose 19.9 per cent, continuing Q1’s 16 per cent increase.

NODX grew 9.1 per cent year on year in Q2, easing from the 11.4 per cent growth in the previous quarter, although both electronic and non-electronic exports grew.

Exports of electronic products rose 9.7 per cent year on year, easing from Q1’s 12.3 per cent, with integrated circuits, parts of integrated circuits and telecommunications equipment contributing most to growth.

Non-electronic exports grew 8.9 per cent year on year in Q2, compared with 11.1 per cent in the previous quarter. Non-monetary gold exports saw a surge of 64.2 per cent.

On a quarter-on-quarter (qoq) seasonally adjusted basis, total merchandise trade rose 9.8 per cent in Q2, compared with the previous quarter’s 5.1 per cent growth. NODX rose a more modest 2.4 per cent qoq, easing from Q1’s 5.5 per cent rise.

Total services trade grew 12.9 per cent to S$168 billion in Q2, extending the 9.8 per cent growth in the previous quarter.



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