2013.07.1703:37:00UTC+00Decline In Singapore Exports Exceeds Expectations

Singapore's exports extended the downward trend in June, with a sharper-than-expected fall caused by the deterioration in both electronic and non-electronic shipments.

Demand from all major markets except China weakened in June, casting concern about the actual realization of economic growth estimated for the second quarter.

The decline in non-oil domestic exports, or NODX, deepened more-than-expected to 8.8 percent year-on-year from 4.6 percent in May, a report from the International Enterprise (IE) Singapore revealed Wednesday. Economists had forecast a 5.8 percent fall.

However, seasonally adjusted NODX grew 3.2 percent on a monthly basis in June, reversing the 1.1 percent fall seen a month ago and non-oil re-exports advanced by a moderate 2.5 percent annually.

Exports of both electronic and non-electronic products contracted from the previous year. Exports of electronic products shrank 12.4 percent in June after a 13.2 percent decline in May.

Due to a sharp decline in orders for pharmaceuticals, ships and boat structures and specialized machinery, non-electronic exports slipped 7.1 percent compared with a marginal increase of 0.2 percent in the previous month.

The top three contributors to the NODX contraction in June were the EU 27, Indonesia and Japan. NODX to the EU27 plunged 33.6 percent and that to Indonesia and Japan were down by 24.8 percent and 25.5 percent, respectively. In addition, NODX to emerging markets decreased 5.4 percent.

The continuous decline in exports suggests subdued contribution to GDP figures in the second quarter.

According to the Ministry of Trade and Industry, the city-state economy expanded annualized 15.2 percent quarter-on-quarter during three months to June. The rebound was estimated to have driven by output of biomedical manufacturing and electronic clusters.

Yesterday, the Asian Development Bank downgraded the growth outlook for developing Asia to 6.3 percent this year, citing slower growth in China and subdued demand from advanced economies.