Singapore imports and exports fell last year but growth for 2021 projected

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Singapore’s total merchandise trade decreased by 5.2 per cent last year, reaching S$969 billion compared to S$1 trillion in 2019. But trade figures for 2021 are expected to grow, as Enterprise Singapore upgraded an earlier forecast from between 1 per cent and 3 per cent to between 2 per cent and 4 per cent.

The decline of 5.2 per cent in overall trade for 2020 is mainly due to a 31 per cent reduction in oil trade, amid lower oil prices than a year ago, according to official data released on Monday (Feb 15). Non-oil trade rose slightly by 0.7 per cent in 2020, after a 0.3 per cent decrease in 2019. Both exports and imports decreased by 3.2 per cent and 7.4 per cent respectively in 2020.

For the fourth quarter of 2020, Singapore’s total merchandise trade fell by 5.1 per cent compared to a year before, following a 4.8 per cent decrease in Q3. This was due to the decrease in oil trade, which outweighed the rise in non-oil trade.

Oil trade fell by 34.8 per cent in Q4 2020, following the previous quarter’s 30.8 per cent decline, while non-oil trade rose by 1.3 per cent in Q4 2020, after the previous quarter’s 0.8 per cent growth.

On a quarter-on-quarter seasonally adjusted (SA) basis, total merchandise trade increased by 0.7 per cent in Q4, after the previous quarter’s growth of 6.9 per cent. Oil trade decreased by 2.3 per cent while non-oil trade grew by 1.2 per cent in Q4.

Non-oil exports (NOX), which include both non-oil domestic exports (NODX) and non-oil re-exports (NORX), rose year on year by 1.7 per cent in 2020, after 2019’s 1.9 per cent decline.

On a quarter on quarter SA basis, NOX grew by 0.5 per cent in Q4, following the 5.1 per cent rise in the preceding quarter. Following a drop of 9.2 per cent in 2019, a growth of 4.3 per cent in NODX last year was due to high shipments of both electronic and non-electronic products, Enterprise Singapore said.

Electronic NODX grew by 4.9 per cent in 2020, after the 22.5 per cent contraction in the previous year. Non-electronic NODX increased by 4.1 per cent in 2020, after the 4.5 per cent decline in 2019.

On a year-on-year basis, NODX decreased by 0.5 per cent in Q4, after the previous quarter’s 6.5 per cent rise, due to the decline in non-electronic NODX, which outweighed the increase in electronics. Electronic domestic exports rose by 2.6 per cent in Q4, following the previous quarter’s 9.2 per cent growth. Non-electronic NODX declined by 1.4 per cent in Q4, after the 5.7 per cent rise in the previous quarter.

On a quarter on quarter SA basis, NODX decreased by 4.7 per cent in Q4, after the 2.2 per cent growth in Q3, due to the decline in both electronic and non-electronic NODX. Electronic domestic exports declined on a quarter-on-quarter SA basis by 3.7 per cent in Q4 2020, following the previous quarter’s 2.6 per cent decrease. Non-electronic NODX declined by 4.9 per cent in Q4 2020, after the 3.7 per cent rise in the previous quarter.

Enterprise Singapore reported that NODX to all top markets grew as a whole in 2020 – however, exports to China, Hong Kong, Indonesia and Malaysia declined. The biggest contributors to the growth in NODX were the US (+38.3 per cent), Japan (+26.1 per cent) and South Korea (+27.2 per cent).

Electronic NODX to the top markets also grew in 2020.

The biggest contributors to the electronic NODX increase were Taiwan (+27.9 per cent), the US (+31.9 per cent) and Thailand (+17.9 per cent). The top three products contributing to the increase in electronic NODX were ICs to Taiwan and disk media products to the US and Thailand.

Non-electronic NODX to the top markets as a whole also increased in 2020, though exports to China, Indonesia, Hong Kong and Malaysia declined. The biggest contributors to the growth in non-electronic NODX were the US (+39.6 per cent), Japan (+33.7 per cent) and the EU 27 (+10.9 per cent). The top three products contributing to the rise in non-electronic NODX were non-monetary gold to the US and EU and pharmaceuticals to Japan.

OIL TRADE

Oil domestic exports contracted by 28.1 per cent in 2020, following the 12.9 per cent decline in the previous year. The decline in oil domestic exports was due to lower shipments of oil to Malaysia (-47.2 per cent), Indonesia (-47.4 per cent) and Australia (-45.8 per cent). On a year on year basis, oil domestic exports contracted by 30.6 per cent in Q4, extending the 29.1 per cent decline in the previous quarter.

On a quarter on quarter SA basis, oil domestic exports grew by 1.2 per cent in Q4, following the 25.8 per cent expansion in the previous quarter.

2021 OUTLOOK

Since the Enterprise Singapore’s last update in November, the 2021 global economic and trade outlook has remained broadly unchanged, with growth expected from a low base in 2020.

The agency said, the International Monetary Fund (IMF) forecast the global economy to grow by 5.5 per cent in 2021, with recovery expected to be uneven across economies. There remain risks and uncertainties in the global economy, with growth forecast for some of Singapore’s key trade partners such as the US and Japan, while trade with other partners, such as China, has been adjusted downwards. On the trade front, the IMF expects global trade volumes to grow by 8.1 per cent in 2021, after 2020’s 9.6 per cent decline.

Meanwhile, improved oil prices since the last update may provide some support for Singapore's oil trade in nominal terms and in turn total trade in 2021. The growth projection this year is adjusted upwards to +2.0 per cent to +4.0 per cent for total merchandise trade, and maintained at “0.0 per cent to +2.0 per cent” for NODX.