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Exports have worst showing in over 3 years

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Nodx shipments plunge 15.9 per cent from May last year

Exports put in their worst performance in more than three years last month amid increasing trade tensions and a plunge in global demand for electronics.

The decline was across the board, with non-oil domestic exports (Nodx) to most of Singapore's key markets recording heavy falls.

Last month's grim numbers also underscore growing weakness in the trade sector over recent months. Shipments of non-oil domestic exports dived 15.9 per cent from May last year, the biggest drop since the 16 per cent slump in March 2016.

While not as bad as the 18.7 per cent decline tipped in a Bloomberg poll, it was far worse than the 11.8 per cent fall in March and the 10 per cent contraction in April.

Enterprise Singapore noted when it released the data yesterday that the decline came off a high base a year ago.

Analysts also pointed to the global electronics slump and trade tensions, while raising concerns that worse may be ahead.

"With the broadening of the US-China trade war to a tech war, Singapore may face increasing pressure and collateral damage," said Maybank Kim Eng economists Chua Hak Bin and Lee Ju Ye.

They noted many of the multinationals that are abiding by the US export controls - Intel, Micron, Broadcom and Panasonic - have a presence here.

The decline of exports to Singapore's key markets was striking - down 23.3 per cent to China, 34.7 per cent to Taiwan and 24.8 per cent to Hong Kong.

Only shipments to the US stayed in positive territory. Reduced exports of non-monetary gold, integrated circuits and specialised machinery led the decrease for China.

DBS senior economist Irvin Seah said the decline in north-east Asia is likely due to China's economic slowdown and the trade war, which are affecting growth in nearby economies and, in turn, demand for Singapore's exports.

Other Asian economies like South Korea, Indonesia and Taiwan have also recorded declining exports in recent months, but Vietnam is bucking the trend with growth in the sector.

Dr Chua said: "Vietnam is benefiting from trade and investment diversion as the China-centred supply chain breaks up and reconfigures towards Asean."

The exports plunge here was led by falling shipments of electronics, which were down 31.4 per cent last month after a 16.3 per cent decline in April.

This was the sector's third consecutive month of double-digit decline.

Lower shipments of integrated circuits, disk media products and parts of integrated circuits were the main culprits.

OCBC Bank economist Howie Lee said the waning global appetite for smartphones and PCs is contributing to poor electronics demand.