Singapore January Exports Plunged 35 percent

AP – 17 February 2009

Singapore's non-oil exports plunged 35 percent in January as global demand collapsed, a bad 2009 omen for a region that's prospered during the last decade largely on selling goods abroad.

Exports, which account for two-thirds of the city-state's gross domestic product, fell in January to 10.0 billion Singapore dollars ($6.6 billion), according to Trade and Industry Ministry figures released Tuesday. Exports fell a seasonally adjusted 3.2 percent in January from the previous month.

"Singapore is setting the wrong sort of records," said Robert Prior-Wandesforde, senior Asian economist at HSBC in Singapore. "The extreme weakness in exports ... will certainly last into the second quarter of this year, as global domestic demand continues to crumble."

Singapore was the first Asian country to report its January export figures, and the dismal numbers bode ill for the region. While Singapore relies more on demand from the West than most other Asian countries, such a steep drop in sales abroad could be a harbinger of an ugly first quarter.

Singapore's economy, battered by declines in manufacturing, finance and tourism, contracted a seasonally adjusted, annualized 16.9 percent decline in the fourth quarter.

Economic growth slowed to 1.5 percent last year from 7.7 percent in 2007, and the government expects GDP to contract as much as 5 percent this year.

Exports in January fell the most since the government began releasing monthly figures in 1980, Prior-Wandesforde said.

The drop in exports was led by electronic products _ which decreased 38 percent from a year earlier in January _ and a 31 percent drop in chemicals, the ministry said.

Exports, which have fallen for nine straight months, slid 21 percent in December and 18 percent in November from a year earlier.

The city-state's exports to Europe in December fell 13 percent while sales to the U.S. dove 50 percent and to Malaysia dropped 40 percent.

Non-oil imports fell 29 percent in January from the same month a year earlier after dropping 14 percent in December, the ministry said.