Non-oil domestic exports to key markets decline, highlighting challenges in the semiconductor and gold trade.
Singapore’s exports saw a sharper-than-expected decline in June, with non-oil domestic exports (NODX) shrinking by 8.7% year on year. This follows a revised 0.7% contraction in May, extending a challenging trend for the Republic’s trade performance. Analysts had predicted a milder decline of 1.3%, but the drop was largely driven by a slump in electronics and non-electronics shipments, including a significant drop in non-monetary gold exports.
Electronics exports fell by 9.5%, a stark contrast to the 19.6% growth seen in May. Key sectors such as telecommunications equipment, disk media products, and integrated circuits were major contributors to this downturn. Despite these setbacks, economists remain cautiously optimistic about the sector’s recovery, noting that the electronics cycle is slowly improving.
Exports to Singapore’s top markets also showed a downward trend in June, with notable declines to the US, China, and Hong Kong. Exports to the US dropped by 21.3%, driven by a sharp decrease in electronic goods, while shipments to China and Hong Kong continued to fall.
Despite these challenges, analysts remain hopeful for a recovery in the second half of the year, citing potential boosts from a tech upcycle and external demand growth. However, uncertainties such as geopolitical tensions and economic policies pose risks to the export outlook, with economists adjusting their expectations for a more gradual recovery.
