Chart of the Day: NODX fell 6.4% in Q1

Lower electronic and non-electronic product shipments weighed on domestic export performance.

This chart from Enterprise Singapore (ESG) shows that non-oil domestic exports (NODX) slipped 6.4% YoY in Q1 2019, extending the 1.1% dip in Q4 2018, due to decreased shipments of both electronic and non-electronic products.

Domestic exports of electronic products declined sharply 17.2% YoY in Q1, following the 3.6% decrease seen in the previous quarter. Disk media products, PCs and ICs declined 37.2%, 37.4% and 7.5%, respectively, and contributed the most to the decrease in electronic NODX.

The largest contributors to the 2.6% YoY fall in non-electronic NODX were specialised machinery (-31.7%), petrochemicals (-11.3%) and primary chemicals (-19.1%).

NODX to all top markets, except the US and Thailand, declined in Q1 2019. The biggest contributors to the NODX decline were Japan (-29.5%), South Korea (-31.5%) and the EU 28 (-9.8%).

Meanwhile, non-oil re-exports (NORX) moderated slightly to 8.3% YoY in Q1, from the 12.7% expansion recorded in Q4 2018, due to higher shipments of both electronic and non-electronic re-exports. Non-electronic NORX rose 12.3% in Q1 2019, extending the previous quarter’s 13.3% growth, whilst the rise in non-electronic NORX was due to higher re-exports of non-electric engines & motors (+107.3%), piston engines (+182.0%) and petrochemicals (+37.0%).

Overall, Singapore’s total merchandise trade inched up 2.1% YoY in Q1, following the 9.2% increase seen in Q4 2018, as the 4.5% YoY growth in non-oil trade outweighed the 6.9% YoY dip in oil trade amidst lower oil prices.

On a YoY basis, oil domestic exports declined 6.5% in Q1 2019, after the 12.1% growth in the previous quarter. In volume terms, oil domestic exports fell 8.3%, following the 4.5% decline in the previous quarter.

Singapore’s total services trade also rose 0.7% YoY in Q1, reaching $122.3b, with both services exports and imports increasing 0.4% and 0.9%, respectively. The growth in services exports was attributed to the increase in receipts from other business services (4.8%), insurance services (32.5%) and transport services (1.1%).

ESG noted that it expects global economic and trade growth to further moderate in 2019 from the expansion in the last two years.

“The International Monetary Fund (IMF) revised downwards the 2019 global economic growth forecast to 3.3% from the previous 3.5% estimate, amidst weaker-than-expected industrial production and slower trade. The growth outlook for some of Singapore’s key trade partners such as ASEAN-5, the US and Eurozone was maintained or adjusted downwards,” the agency highlighted.

On the trade front, the World Trade Organisation (WTO) also forecasted world merchandise trade volumes to grow by 2.6% in 2019, down from 2018’s 3% growth. ESG noted that this reflects the downgraded gross domestic product (GDP) projections for North America, Europe and Asia.

That said, ESG highlighted that an improvement in oil prices may support Singapore’s oil trade, although prices are expected to be lower compared to 2018.

“Fundamentals in key sectors such as biomedical and general manufacturing (e.g., food preparations) should support exports in 2019,” the agency said. “The 2019 growth projection for total trade is maintained at 0 to 2%, whilst NODX is adjusted downwards to -2 to 0%.”