SINGAPORE: Exports in Singapore slumped further in October, falling 12 per cent following a 5 per cent decline the previous month, according to figures released by International Enterprise (IE) Singapore on Thursday (Nov 17).
Non-oil domestic exports (NODX) were hit by a decline in both electronic and non-electronic exports, the trade agency said.
Electronic shipments fell 6 per cent, following a 6.6 per cent decline the previous month. The contraction was largely due to ICs (-5.1 per cent), disk drives (-47.7 per cent) and telecommunications equipment (-19.9 per cent).
Non-electronic exports plunged 14.6 per cent, after a 4.2 per cent contraction the previous month. The decline was led by pharmaceuticals (-47 per cent), petrochemicals (-7 per cent) and civil engineering equipment parts (-40.7 per cent), IE Singapore said.
Overall, shipments to the majority of Singapore’s top 10 markets fell, with the European Union, Japan and Indonesia leading the decline. Bucking the trend were exports to Taiwan, Hong Kong and South Korea, which rose between 1 per cent and 19.4 per cent.
Non-oil re-exports (NORX) declined 8.9 per cent last month, compared to the 1.2 per cent growth in September, with declines in both electronic and non-electronic re-exports.
GROWING DOUBT OVER TPP
One analyst attributed the decline in key exports to weak global growth. "Global growth has been pretty weak, which has affected Singapore, which is very much dependent on external trade," said Mr Miguel Chanco, the lead ASEAN analyst at the Economist Intelligence Unit.
"This is not just weakness from the US. It's weakness from key markets in the region, like Malaysia and Indonesia, coming up at their slowest growth rates in many years this year.
"So it's not surprising to see this sharp contraction. It does break a string of good numbers for the past few months, but going forward, we expect, somewhat, a cyclical upswing in exports so we're not too worried at this point."
Global demand conditions aside, observers say overall trade recovery is threatened by rising anti-globalisation sentiment, as reflected in the recent Trump victory in the US and the Brexit vote in the UK.
Mr Weiwen Ng, an economist for South and Southeast Asia at ANZ Research, cited growing doubt over whether the 12-nation Trans-Pacific Partnership (TPP) trade pact will materialise.
"Asia, effectively, is at the crossroads of global trade flows, helped by the ascension of China into World Trade Organization in 2001," he said. "I think Trump's protectionism - if it does materialise - threatens to derail this pace of globalisation, and it'll be negative for the regional supply chain networks, and negative for trade dependent economies like Singapore.
"In the quarters ahead, we might be out of a trade recession, but trade is likely to equilibriate at a lower level."
TRADE WILL STILL FLOW IN ASIA
Still, within Asia, one economist said he expects a continued focus on liberalisation through other trade agreements within the region.
"Especially the export driven countries will continue to stay on the stance that trade liberalisation is good for everyone," said Mr Irvin Seah, a senior economist at DBS. "I think this has been the consensus by many regional countries thus far. Which is why, for example, within ASEAN we have the ASEAN FTA (Free Trade Agreement), and ASEAN has signed trade agreements with many regional countries like China, Japan, India.
"So with the risk that TPP will never materialise, I don't think it will affect the momentum that has already been set in the region. It will definitely be a setback not just for the region but also on a global perspective, but everyone does understand the benefits of trade liberalisation."