Singapore’s export growth slowed more than economists expected last month as electronics shipments fell after the Lunar New Year holidays curbed demand from China for manufactured parts.
Non-oil domestic exports climbed 7.8 percent from a year earlier, after a revised 20.7 percent gain in January, Singapore’s trade promotion agency said in a statement yesterday. The median forecast of 11 economists surveyed by Bloomberg News was for an increase of 10.5 percent.
Overseas sales are set to ease this year after a global economic rebound spurred Singapore export growth to the fastest pace in seven years last year. The biggest Japanese earthquake on record, with its ensuing tsunami and nuclear plant crisis, may further dampen shipments.
“Manufacturing plants in China, key buyers of Singapore -manufactured components and intermediate products typically enter a lull period during the festive season,” Irvin Seah, an economist at DBS Group Holdings Ltd in Singapore, said before the report.
There will be “some impact” from the Japan disaster over the next few months, before exports get a lift during the reconstruction period, he said.
Non-oil shipments may increase 8 percent to 10 percent this year, the government predicts. Exports grew 22.8 percent last year.
Electronics shipments declined 12.8 percent last month from a year earlier, after gaining 5.8 percent the previous month. Non-electronics shipments, which include petrochemicals and pharmaceuticals, gained 19.7 percent. Pharmaceutical shipments added 1.3 percent after advancing 38.6 percent in January.
The performance of -Singapore’s pharmaceutical industry is volatile as production swings from companies such as Sanofi-Aventis SA can cause industrial output to fluctuate from month to month. Drug companies sometimes shut plants for cleaning before making different products.
Singapore’s non-oil exports rose a seasonally adjusted 2.9 percent last month from January, when they gained a revised 2.1 percent, the report showed.
“Though key electronics and pharmaceutical exports appear to be in a soft patch over the last two months, we reckon that this will not last for long,” Seah said. “Recovery in the US is solidifying with increasingly strong consumption data. In addition, as long as Asia central banks do not overkill in their monetary tightening, we should see external demand picking up again towards the second half of the year.”