Singapore cuts 2023 trade forecasts after exports slump in Ql

Nodx expected to shrink by 8% to 10% amid downturn in global electronics sector

- Prisca Ang

Singapore cut its 2023 growth forecasts for key non-oil domestic exports (Nodx) and total merchandise trade, which includes oil, amid a sharp downturn in the global electronics sector that has weighed on manufacturing in Asian economies.

Nodx is now expected to shrink by 8 percent to 10 percent, and total merchandise trade to contract by 6 percent to 8 percent, dragged down by the manufacturing down cycle and lower oil prices, Enterprise Singapore (EnterpriseSG) said on Thursday.

This pales against its previous forecast of minus 2 percent to 0 percent growth for both trade measures.

The downgrade comes after both Nodx and total merchandise trade came in worse than expected in the first quarter.

Nodx tumbled 16.2 percent year on year, extending the 14 percent decline in the fourth quarter.

Meanwhile, total merchandise trade fell by 7.8 percent, sharper than the 1 percent dip previously.

In tandem, Singapore's economy cooled in the first quarter and is forecast to grow by 0.5 percent to 2.5 percent in 2023, likely around the midpoint of the range.

OCBC Bank chief economist Selena Ling said Nodx should improve somewhat in the second half of 2023.