Singapore’s electronics exports slumped in March by the most since 2013, an ominous sign that it will take longer for the city state to shake off a regional demand slowdown from earlier this year.
Electronics shipments dropped 26.7 per cent from a year ago, weighing down overall non-oil domestic exports, which fell 11.7 per cent. That was far worse than the 2.2 per cent contraction forecast by economists in a Bloomberg survey.
The Chinese economic slowdown, uncertainty over US-China trade talks, and disruptions around the Lunar New Year holidays have soured exports numbers this year, especially in trade-reliant economies like Singapore’s. The city state’s critical electronics sector has contracted for 15 of the past 16 months after an unexpected surge across the region for much of 2017.
The broad March contraction in exports could imperil economic growth, which slowed to 1.3 per cent in the first quarter from a year ago, according to an advanced estimate from the government. Economists at Maybank Kim Eng Research Ltd. predict the government will lower its growth forecast range for the full year to 1-3 per cent, from 1.5-3.5 per cent, after the exports report.
Weaker Chinese demand has also resulted in exports to the US outpacing those to China for the first time in more than seven years.
The figures were released days after a newspaper report that US electronics giant International Business Machines Corp. is closing its technology park in Singapore. IBM will move the manufacturing of its mainframe computers to the US and fire hundreds of workers, according to Today.
Economists are counting on a recovery in Chinese demand, helped by government stimulus measures, which should filter through to the region’s economies. China’s economy grew a better-than-expected 6.4 per cent in the first quarter from a year ago, matching the previous three months’ pace, government data showed Wednesday.