Singapore cuts key exports forecast for 2024 amid weaker-than-expected recovery

SINGAPORE: Singapore on Friday (Nov 22) cut its non-oil domestic exports (NODX) growth forecast for 2024 amid a weaker-than-expected recovery.
NODX in 2024 is now expected to grow by about 1 per cent year-on-year, down from the forecast in August of a 4 to 5 per cent expansion, said Enterprise Singapore.
“While the external environment is generally supportive of growth, uncertainties in the global economy such as a more challenging and competitive trade environment could weigh on global trade and growth,” it added.
At the last update, it was highlighted that downside risks, including a weaker-than-expected recovery in the second half of 2024 could potentially lead to NODX growth coming in below the forecast range.
That weakness has materialised, said EnterpriseSG, with NODX performing weaker than expected, primarily due to the volatile segments such as pharmaceuticals and ships and boats.
This could continue to weigh on the fourth quarter performance.
A net weighted balance of 8 per cent of firms in the pharmaceuticals segment forecast new export orders for the fourth quarter, down from 56 per cent in the previous quarter.
Electronic NODX performance also moderated in September (-0.7 per cent year-on-year) and October (2.6 per cent year-on-year). This was compared to the double-digit growth in July and August, at 16.7 per cent and 35.1 per cent respectively.
EnterpriseSG noted that the International Monetary Fund has projected that global economic activity will grow by 3.2 per cent in 2025.
Most of Singapore’s key trade partners, including China, the US, the 27 member states of the European Union and ASEAN-5 (Indonesia, Malaysia, the Philippines, Singapore and Thailand) are projected to grow, it said.
“Similarly, on the trade front, the WTO (World Trade Organization) expects global merchandise trade to grow by 3 per cent in 2025, faster than the 2.7 per cent in 2024, although rising geopolitical tensions and economic policy uncertainty pose downside risks to its forecast,” said EnterpriseSG.
NODX grew by 9.2 per cent year-on-year in the third quarter, after the 6.5 decrease in the previous quarter, EnterpriseSG said.
Electronics grew faster, marking the second consecutive quarter of growth, while non-electronics rebounded after two quarters of declines.
Domestic exports of electronic products rose by 17 per cent on a year-on-year basis, following the 3.8 per cent increase in the previous quarter.
Integrated circuits, disk media products and PCs grew by 23.7 per cent, 117 per cent and 52.1 per cent respectively, contributing the most to the growth in electronic NODX.
The domestic exports of non-electronic products grew by 7 per cent, after the 9.2 per cent decline in the previous quarter.
The largest contributors to the growth in non-electronic NODX were specialised machinery (18.8 per cent), non-monetary gold (43.9 per cent) and food preparations (20.6 per cent).
NODX to the top markets rose in the third quarter, said EnterpriseSG. The biggest contributors to growth were Malaysia (30.7 per cent), China (12.7 per cent) and the US (6 per cent),
On a quarter-on-quarter seasonally adjusted basis, NODX grew by 7.9 per cent in the third quarter, after the 1.3 per cent decrease in the previous quarter.