Singapore’s exports for last month fell more than economists estimated as manufacturers shipped fewer electronics, adding to signs of a regional slowdown that has prompted the World Bank to cut some growth forecasts.
Non-oil domestic exports slid 4.6 percent from a year earlier, after falling 1 percent in April, the trade promotion agency said in a statement yesterday.
The median of 10 estimates in a Bloomberg News survey was for a 0.2 percent drop.
Shipments of electronics dropped 13.2 percent from a year ago, extending the slump to a 10th month.
The World Bank this month cut its global growth forecast for this year after emerging markets from China to Brazil slowed more than projected, weakening prospects for Singapore’s trade-dependent economy.
“We do expect soft global demand to keep a lid on export growth this year for the Asia region,” said Michael Wan, an economist at Credit Suisse Group AG based in Singapore.
“In addition, exports of the commodity-focused countries, such as Indonesia and Malaysia, will also be affected by China’s moderation to more sustainable growth levels,” he said.
The Singapore dollar fell 0.2 percent to S$1.2535 against the US currency as of 2:06pm. The currency has weakened almost 3 percent in the past six months.
The depreciation probably will not help exports, said Song Seng Wun (宋城煥), an economist at CIMB Research Pte in Singapore.
“As far as Singapore’s manufactured goods are concerned, it’s more about end demand than the exchange rate,” Song said.
“If there’s no demand, no matter how much gain you get from the currency depreciation, it hardly makes a difference in terms of whether the Singapore dollar is stronger or weaker” in the short or medium term, he said.
The slide in Singapore’s electronics shipments by companies such as Venture Corp is the longest string of losses since 2009, and comes even as output of such goods rose in April. Analysts have lowered their estimate for the city-state’s export expansion this year to 2.5 percent from 4 percent, according to a survey by the central bank this month.
“There could be a bit of inventory buildup in electronics exporters,” Wan said. “They are producing in anticipation of future demand, and there’s a risk that this demand might not be met in the coming months.”
Singapore’s non-electronics shipments, which include petrochemicals and pharmaceuticals, rose 0.2 percent last month from the previous year. Petrochemical exports climbed 3.9 percent, while pharmaceutical shipments increased 19.9 percent.
The government forecasts exports will rise 2 percent to 4 percent this year and predicts economic growth of 1 percent to 3 percent.
Singapore’s GDP rose an annualized 1.8 percent in the three months through March as services and construction strengthened.