Singapore’s key exports chart surprise 2.1% slide in January on Chinese New Year distortions

SINGAPORE’S non-oil domestic exports (NODX) surprised in January as it declined 2.1 per cent year on year, following two months of growth, data from Enterprise Singapore (EnterpriseSG) showed on Monday (Feb 17).

But economists attributed the drop to January 2024’s high base, as Chinese New Year fell later last year, in February, compared to this year’s late January.

The weak performance should not be too much of a concern, considering the timing, said HSBC Asean economist Yun Liu.

Aggregated data from January and February 2025 will provide a better gauge of Singapore’s export dynamics, by smoothing out the typical Chinese New Year holidays-related volatility, economists agreed.

The latest print reversed from the preceding month’s revised 9 per cent expansion, and underperformed against the median 0.3 per cent growth forecast in a Bloomberg poll of private-sector economists.

On a seasonally adjusted monthly basis, NODX slipped 3.3 per cent in January to S$14.9 billion, reversing from December’s 1.3 per cent gain.

The data for January comes just days after EnterpriseSG announced that NODX grew 0.2 per cent year on year for 2024 as a whole. For 2025, it maintained its full-year forecast range of 1 to 3 per cent.

On year, electronics exports rose 9.6 per cent in January, narrowing from the 18.6 per cent jump in the month before. Integrated circuits (14.6 per cent), PCs (66.7 per cent) and disk media products (31.5 per cent) led the increase.

UOB associate economist Jester Koh attributed the moderating pace of growth to the dissipation of favourable base effects from August 2022 to December 2023.

Liu noted: “It took NODX around 2.5 years from its trough to peak in the last tech upturn, and if history can provide us some insights, this suggests that NODX may still be able to enjoy tech tailwinds for around six months.”

But Koh believes the year-on-year growth has likely peaked. The electronics cycle in South Korea and Taiwan, which serves as a bellwether for the region, “has convincingly peaked sometime in Q3 2024 and is in the early phase of a year-on-year downcycle”, he said.

“In our view, Singapore’s electronics NODX growth has similarly peaked in late Q4 2024 although we require a couple more readings to be more certain.”

Non-electronics shipments, meanwhile, slid 4.8 per cent year on year, in a turnaround from the 6.6 per cent growth recorded in December. Pharmaceuticals (-53 per cent), specialised machinery (-9.9 per cent) and miscellaneous manufactured articles (-20 per cent) contributed the most to the decrease in non-electronic shipments.

Pharmaceuticals, typically volatile, has been in contraction for four consecutive months.

DBS economist Chua Han Teng believes that the NODX dip is temporary and expects a rebound and a continuation of late 2024’s positive NODX performance in early 2025.

The continued expansion of new export orders in headline and electronics purchasing managers indices as at January 2025 points to resilient near-term external demand for Singapore’s exports, he said.

Economists flagged the potential impact of US tariffs.

Maybank economists Chua Hak Bin and Brian Lee noted hints of front-loading in January’s data, amid Trump’s tariff hikes on Chinese shipments. 

DBS’ Chua Han Teng said escalating threats could stoke a further rush to front-load export orders, including from Singapore, in the near term.

The Maybank duo believes that Trump’s broadening tariff war will slow global trade in 2025, particularly in the second half. 

Meanwhile, Chua said a wider global trade war still poses medium-term challenges and downside risks to highly trade dependent Asian economies, including Singapore.

Of Singapore’s top markets, NODX to half expanded. Key exports to Hong Kong more than doubled, and NODX to the US, Taiwan, Japan and South Korea also grew in January 2025, but exports to China, Indonesia, the European Union, Thailand and Malaysia declined. 

Overall, total trade climbed 6.7 per cent from the corresponding year-ago period in January, slowing from the 19 per cent growth in the preceding month. Total exports rose 3 per cent, while total imports expanded 11.2 per cent.