For the first time in eight months, Singapore’s exports fell in November. Exports to China, which is the country’s biggest market, have continued to diminish, reflective of slower economic growth in China.
Industry experts around the globe have expressed concerns about how ongoing trade tensions between the two biggest economies in the world would affect the countries. In Singapore, experts say the impact may last for months, given the city state’s dependence on trade for its economy.
The South China Morning Post reports that economists in a Reuters poll had predicted that the country’s non-oil domestic exports would grow by 1.2 percent, but in reality, they fell by 2.6 percent in November year-on-year, based on data provided by trade agency Enterprise Singapore. This is the first negative reading since March.
Added to the decrease in export and slowed trade with China, shipments in pharmaceuticals have also become sluggish of late.
An economist at Oxford Economics, Sian Fenner, wrote in a research note to clients, “While domestic exports to the US remained healthy, shipments to China continued to weigh on overall growth. Notwithstanding the recent truce in the US-China trade war, we think weaker Chinese import demand, amid increased trade protectionism, will increasingly weigh on exports and Singapore (GDP) growth over 2019.”
For the fourth consecutive month, the volume of trade to China went down again in November, lessened by 16 percent from 2017. In October the decline was 28.5 percent.
Song Seng Wun, an economist with CIMB, said, “China growth has moderated, and that’s the primary reason (for the declining exports to China. If you look at retail sales, it’s quite indicative that Chinese macro fundamentals have weakened.”
Retail sales in the second largest economy in the world showed their slowest growth since 2003 while the economy’s momentum kept slowing down. This has added pressure on Beijing to settle the trade war with the United States.