Singapore exports contract for eighth month, as US-China ‘trade war heat’ saps city state’s growth

Non-oil exports were worse than expected in October, falling 12.3 per cent from a year earlier, after a sharp decline in sales to China, EU, US and Japan

The city state is disproportionately exposed to fluctuations in global trade, since its exports-to-GDP ratio is higher than almost every other nation

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US-China trade war continues to dampen Singapore’s exports, after the eight successive month of decline. Photo: AFP

Published: 11:18am, 18 Nov 2019Updated: 9:47pm, 18 Nov 2019

Singapore’s trade woes continued in October, with exports falling for the eighth month in a row and imports also continuing to decline.

Non-oil exports fell by 12.3 per cent in October from a year earlier, after an 8.1 per cent decline in September. Imports fell 10.3 per cent, after a 4.8 per cent fall in September. Combined, total trade volume fell by 9.7 per cent, much worse than September’s 5.0 per cent reading.

The city state is particularly exposed to vulnerabilities in global trade, due to the fact that its export to gross domestic product (GDP) ratio is higher than any other country with the exception of Luxembourg. It is no surprise, then, to see that Singapore’s trade with China has been nosediving at a time when the Chinese economy has been in a prolonged downturn.

Singapore’s non-oil exports to China fell by 5.5 per cent last month, while in the crucial electronics sector, exports were down 21.3 per cent. As global trade continues to lag and demand weakens among many important consumer markets, Singapore stands to suffer further, with analysts across the board negative about its economic outlook.

A trade bellwether, Singapore is always going to feel the trade war heat first but is also positioned to recover much faster as a result

Jeffrey Halley

October’s data was far worse than analysts had expected. Consensus forecasts had been for a 10.4 per cent drop in exports, continuing a run in which the economy has often been worse than experts expected.

Singapore’s economic growth for the third quarter will be announced later this week, with analysts expecting growth of just 0.1 per cent. However, a second quarter slump of 2.7 per cent was predicted by few.