Singapore’s non-oil domestic exports (NODX) pencilled in a single-digit growth following expansions in both non-electronic and electronic shipments.

Official figures released by trade agency Enterprise Singapore (ESG) on August 17 pointed to a 6.0% growth in July, narrowing from the 13.9% expansion logged in June. June’s showing was driven by a low base in the period a year ago, and was revised downwards from the 16.1% posted previously, ESG said.

The latest data for July is still a jump from the 4.4% growth anticipated by private-sector economists in a Bloomberg poll.

Specifically, the increase was heralded by a 6.9% growth in non-electronic shipments, which narrowed from the 11.7% growth logged in June. A substantial boost came from 227.9% surge in non-monetary gold, as the precious metal is deemed a safe-haven asset in this downturn.

Increased shipments of specialised machinery (+60.1%) and pharmaceuticals (+15.5%) also provided a lift to the segment’s growth.

Meanwhile, the linchpin electronics sector logged a 2.8% growth in July, easing from its low-base driven expansion of 22.2% in June. Its mediocre performance follows a dip export volumes of disc media products, telecommunications equipment and ICs by 23.0%, 18.2% and 1.5% respectively.

On a month-on-month seasonally adjusted basis, NODX was up 1.2%, reversing from the previous month’s 1.4% decline. “The growth in non-electronic domestic exports outweighed the decline in electronics,” ESG explains.

This translated to $14.1 billion in takings for June’s NODX, down from the previous month’s $14.0 billion.

Singapore’s NODX to its top 10 markets grew in July, with exports to the US (+98.7%), South Korea (+56.3%) and Taiwan (+18.7%) leading the way.

Interestingly, shipments to the US follows a multi-fold increase from June’s 23.1% growth and comes from heightened exports of non-monetary gold, disk media products (+213.4%) and food preparations (+20.4%).

Conversely, NODX to South Korea eased from June’s 85.6% expansion but continued to log strong growth in specialised machinery (+375.8%), pharmaceuticals (+355.2%) and miscellaneous manufactured articles.

Exports to Taiwan saw a similar showing as it narrowed from a 32.5% surge in the preceding month. July’s performance builds on growth in shipments of specialised machinery (+51.3%) and ICs (+24.5%).

On the contrary, NODX to Indonesia (-20.7%), Thailand (-24.7%), Hong Kong (-15.1%), China (-5.1%), the EU27 (-8.9%) and emerging markets (-22.0%) staged declines, possibly due to the ongoing movement control restrictions from Covid-19.

Meanwhile, July saw a 2.8% drop in non-oil re-exports (NORX), reversing from the 5.4% growth logged in June. This is on the back of a 15.8% contraction in non-electronic shipments, led by declines in piston engines (-62.7%), non-monetary gold (-60.0%) and aircraft parts (-23.1%).

Further declines to NORX was mitigated by an 11.9% growth in electronic shipments, following growth in parts of PCs (+40.3%), telecommunications equipment (+23.6%) and ICs (+8.5%).

In this time, NORX to most of the top 10 markets grew, with contributions mainly coming from Hong Kong (+20.5%), the US (+11.4%) and the EU 27 (+8.5%).

Overall, total trade plunged to 8.9% year-on-year, following the 7.0% fall registered in the preceding month. The contraction in total exports deepened to 7.9% from June’s -4.3% showing, while total imports declined 9.9% in both July and June.

July’s NODX is “better-than-expected” and follows resilient demand for electronics – which accounts for 22% of NODX – and pharmaceuticals (10% of total NODX), explain Maybank Kim Eng economists Chua Hak Bin and Lee Ju Ye.

What this means is, “manufacturing will likely escape a recession as exports and regional trade recover,” the duo note.

Looking ahead, Chua and Lee expect NODX to “gradually improve” in 3Q2020 ending September as more economies reopen. The effects of this have already been seen in the improved exports to regional powerhouses such as China, Vietnam, South Korea and Taiwan.

Meanwhile, JP Morgan economist Ong Sin Beng expects a pickup in electronic exports in the coming months.

“Tech and pharmaceuticals exports look to be cooling following their recent firming even as other exports, including gold, have turned up. Given the resilience and lift in tech exports in the region, it appears that electronics exports should soon resume their uptrend after a pause in July,” he observes.

However, the recent rise in Covid-19 infection rates could possibly put a dent in the demand recovery for Singapore’s NODX, says Ong. Such a scenario “could lead to an uneven path beyond the initial expansion [to mid-2021],” he points out.