Non-oil exports forecast to fall 1-2% this year

[SINGAPORE] Non-oil domestic exports (NODX) are tipped to dip 1-2 per cent this year.

International Enterprise Singapore (IE Singapore) announced yesterday that it had trimmed its full-year NODX growth forecast from 1-3 per cent to between -2 and -one per cent.

NODX fell 2.3 per cent year on year in the first half of this year.

The trade promotion agency also narrowed the forecast for total trade growth from 1-3 per cent to 1.5-2.5 per cent. Total trade rose 5 per cent in the first half of the year.

NODX and total trade slipped 6 per cent and 0.5 per cent respectively last year.

Yesterday's revisions in the trade numbers came on the heels of the Ministry of Trade and Industry's adjusting its full-year economic growth forecast from 2-4 per cent to 2.5-3.5 per cent.

Looking ahead, IE Singapore said it expected the NODX to see a "modest improvement" in tandem with a gradual pick-up in the global economy, though its one per cent decline in the first quarter was extended to a bigger 3.4 per cent fall in the second.

Total trade growth, at 7.2 per cent in the first three months, moderated to 2.9 per cent in the following three months.

Growth in non-oil re-exports (NORX) also slowed from 14.3 per cent to 2.9 per cent over the same period. Still, the NORX put in a respectable 8.1 per cent gain in the first half and is tipped to remain "resilient".

Quarter-on-quarter, the NODX dipped by a seasonally adjusted 0.1 per cent in Q2, after a 0.8 per cent drop in Q1.

The electronic NODX fell 1.2 per cent in Q2, against a 5.4 per cent decline in Q1.

Quarter-on-quarter, the non-electronics NODX rose a seasonally adjusted 0.4 per cent in Q2 and 1.2 per cent in Q1, but not enough to offset the fall in the electronics NODX.

Compared to a year ago, the electronics NODX tumbled 13.8 per cent in Q2 and 12.8 per cent in Q1. The non-electronics NODX inched up 1.5 per cent in Q2, following a 4.5 per cent rise in Q1.

NODX shipments to the top 10 markets - except for China, Malaysia, Indonesia and the United States - fell in Q2.

China was Singapore's biggest market in the first half of this year, with 15.2 per cent of total NODX, which jumped 11.6 per cent in Q2; in the first half, the rise was 16.4 per cent.

Exports to the US rose 0.6 per cent in Q2, and 3.8 per cent in the first half. They increased 11.9 per cent to Malaysia for Q2, and 8.2 per cent in the first half. Q2 exports to Indonesia rose 4.7 per cent and 2.3 per cent in the first half.

Hong Kong, the European Union and Thailand were the biggest contributors to the NODX's decline in Q2. Shipments to Hong Kong plunged 25.4 per cent (-22.6 per cent in the first half); to the EU, exports were down 13.1 per cent (-10.5 per cent in the first half); and to Thailand, they slipped 11.5 per cent (-6.4 per cent in the first half).