Singapore’s non-oil domestic exports (NODX) for the month of February saw a 4.2% y-o-y increase, following the 12.7% expansion in January.

According to figures released by Enterprise Singapore (ESG) on March 17, the increase was mainly due to broad-based growth in both non-electronic and electronic goods.

Electronic NODX grew by 7.4% y-o-y following January’s 13.5% expansion, led by personal computers (PCs), telecommunications equipment and diodes and transistors at 98.3%, 78.6% and 39.1% respectively.

The growth in PCs comes on the back of a 31.4% contraction in February 2020 amid the global electronics downcycle.

Non-electronic NODX rose by 3.3% y-o-y led by a 167.5% surge in non-monetary gold. Specialised machinery and petrochemicals, which grew 35.6% and 19.3% y-o-y, contributed to the growth in non-electronic NODX.

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On a seasonally adjusted basis, NODX rose 8.2% m-o-m following the previous month’s 6.9% increase.

Electronic and non-electronic domestic exports grew during the period.

The level of NODX reached $16.7 billion in February, higher than the $15.4 billion recorded in January.


SEE:Non-oil domestic exports makes surprising rebound in June


NODX to the top 10 markets declined on the whole led by the EU 27 (-34.7%), Japan (-18%) and the US (-5.3%), offset by growth in domestic exports to China, South Korea, Taiwan and Hong Kong.

The drop in NODX to the EU 27 follows the 20.2% decrease in January due to pharmaceuticals (-51.8%), capacitors (-97.4%) and miscellaneous manufactured articles (-37.2%).

NODX to Japan also declined for the second month running from January’s 16.9% drop due to non-electric engines and motors (-99.0%), pharmaceuticals (-47.1%) and specialised machinery (-43.7%).

NODX to the US saw slight improvement from the 8.3% decline in the preceding month. February’s decline to the US was attributable to non-electric engines and motors (-84.2%), pharmaceuticals (-46.6%) and disk media products (-63.0%).

On the other hand, NODX to emerging markets (EMs) expanded by 45.7% in February, following the 43.2% growth in January.

This was led by a 229.3% y-o-y growth in Cambodia, Laos, Myanmar and Vietnam (CLMV), the Caribbean (+21.2%) and South Asia (+3.7%).

Singapore’s non-oil re-exports (NORX) increased by 2.7% y-o-y in February, led by the growth in electronic re-exports, which outweighed the decline in non-electronics.

Electronic NORX increased by 15.6% led by ICs (+14.1%), telecommunications equipment (+48.1%) and PCs (+31.0%).

Non-electronic NORX, however, fell 9.5% y-o-y due to aircraft parts (-59.7%), non-electric engines and motors (-29.8%) and piston engines (-52.4%).

NORX to the majority of the top 10 markets grew during the month led by China (+50.4%), Hong Kong (+15.4%) and Indonesia (+22.4%), though re-exports to Korea, the US, Vietnam, Japan and Taiwan declined.

NORX rose by 4.7% on a seasonally-adjusted m-o-m basis due to growth in electronic and non-electronic NORX.

NORX reached $26.5 billion in February, higher than the $25.3 billion in January.

Total trade fell by 3.3% y-o-y in February. Total exports fell by 2.0% y-o-y while total imports decreased by 4.6% y-o-y.

On a m-o-m basis, total trade was up by 6.0% y-o-y, reaching $91.8 billion in February.

Total exports rose by 6.3% m-o-m, while total imports increased by 5.7% m-o-m.

Analysts' comments

To OCBC Bank’s Selena Ling, head of treasury research and strategy, February’s NODX growth stood below her expectations at 8.4% y-o-y, or a 1.1% m-o-m decline.

“The moderation in momentum was not entirely unexpected given the change in Chinese New Year timings which fell in January last year but February in 2021,” says Ling.

“Hence, it may be more appropriate to look at the January-February average NODX growth instead – NODX actually expanded 8.5% for the first two months of this year, compared to -0.1% yoy for the same period last year,” she adds.

On the slower electronics export growth, Ling attributes this to the seasonal Chinese New Year effects despite strong double-digit growth in PCs, telecomm equipment and diodes & transistors.

“Still, the global electronics upcycle should sustain in the coming months given the transition to 5G, continued global demand for PCs and telecomm equipment, and the global chip shortage.”

The decline in NODX to developed markets also came as no surprise to Ling, who attributed the lower figures to the resurgence of Covid-19 cases and fresh lockdowns as well as movement restrictions in Europe and Japan at the start of 2021.

“Going into 2Q2021, the NODX growth will be elevated by the low base due to the Circuit Breaker during April-May 2020,” she predicts.

“For the full-year, our NODX growth forecast remains unchanged at 2% y-o-y. Given the rising optimism about a vaccine-aided global recovery, with the Biden administration’s latest US$1.9 trillion fiscal stimulus being icing on the cake for the US economy coupled with signs of a robust recovery in China, hopes are growing that the 2H2021 recovery will be on a more stable footing, notwithstanding the base illusion effects which will result in very volatile 1H2021 economic data prints,” she adds.

While February’s NODX stood lower than market estimates of 6.1%, according to UOB economist Barnabas Gan, he views the numbers as positive for an “optimistic external environment for Singapore on the back of a vaccine-driven global economic recovery in 2021”.

“This will likely support global export demand, and with it, drive economic performance for export-oriented economies such as Singapore,” he says.

“The improving global economic backdrop and rising oil prices are strong drivers to lift Singapore’s export momentum in 2021. This suggests that shipments in products that had been lacklustre may turn more positive in the year ahead. With more clarity on NODX in the first two months of 2021, we expect full-year NODX growth at 1.0% in 2021, led by exports of telecommunications equipment (2021: +79.7%, 2020: +8.3%), personal computers (2021: +70.3%, 2020: -11.1%) and consumer electronics (2021: 25.5%, 2020: +7.0%),” he adds.

Maybank Kim Eng economists Chua Hak Bin and Lee Ju Ye say they expect NODX growth to ease to around 3% to 4% in 2021 following the “strong performance” in 2020 where the lockdowns did not impact exports much.

That said, Chua and Lee see export outlook being dampened by supply and logistics bottlenecks, “including the congestion at ports and chip shortages”. “Container ships face longer wait times and delays at ports due to surging cargo volumes and stricter lockdowns in some countries. The turnaround time for container vessels in Singapore’s port has more than doubled to five to seven days, from a maximum of two days earlier,” they write.

“Chip shortages may also disrupt the whole tech and auto supply chain, impacting electronics exports. We maintain our GDP growth forecast at +4.5% in 2021, and expect the Monetary Authority of Singapore (MAS) to maintain its current S$NEER neutral stance at the April meeting,” they add.

For JP Morgan’s Sin Beng Ong, trade should continue to expand in 2021, depending on the impact of the US stimulus.

“Given the expected recovery in the rest of the world, our view remains that the underlying recovery in goods demand should continue though mixed in with periodic volatility,” he writes.

“That said, it remains to be seen how much marginal demand US stimulus might add to goods given the different starting positions goods and services. In a scenario where the demand lift is biased towards services, this would suggest a weaker impulse on the region.