Domestic exports of non-oil products fell 8.5 percent from a year earlier according to data from the Enterprise Singapore. This shows accelerated decline from the 2.8 percent fall from the month before. There are signs that the US will start to ease tariffs with China during ongoing negotiations, but it is now clear, by looking at autos and other specific parts of the US economy, that the slowdown in greater China has started to take hold. Many economists expect this trade war to damage the Singapore economy in 2019.
This current decline was unexpected in intensity as the fall in trade seems to be accelerating across Asia and for a small state like Singapore that relies heavily on the outside world, as some people say that the US China trade talks may be a ruse. “There is a likelihood that exports will fall and continue into the first quarter,” according to one economist. Some economists believed that the fall would be only 1.5 percent, but now we are looking at 8.5 percent and perhaps more in the coming quarter. This means that 2019 could be a tough year for Singapore.
Shipments across Asia were lower and Singapore is expecting a fall in GDP – like other countries in the region.
Earlier this week, China announced that exports fell 4.4 percent while some auto manufacturers in the second largest economy are running production at half its normal pace. One Range Rover plant that was producing 10,000 vehicles per month is only producing half that amount. In the case of the city-state of Singapore, exports on a month-on-month basis contracted 5.7 percent in December, after a 4.3 percent fall in November. Electronic exports were hit with a fall of 11.2 percent in December – this comes after a brief recovery in November.
Exports of pharmaceuticals dropped 26.8 percent in December – a fall that few expected.