Thursday January 29, 2009

Singapore recession deepens as NODX (non-oil domestic exports) fall 20.8% in Dec 2008

This article belongs to the Singapore recession watch story arc.

bloomberg.com :

Singapore's exports fell the most since early 2002 in Dec 2008 as a deepening slump in global economies pared demand for electronics and pharmaceuticals. Non-oil domestic exports [NODX] dropped 20.8% from a year earlier, after contracting 17.5% in Nov 2008. Singapore's economy is in a recession, forcing manufacturers to fire workers and prompting the government to move forward its 2009 budget announcement to speed up its response to the crisis. Meanwhile, China's exports fell the most in almost a decade in December, while Taiwan's overseas shipments slumped by a record 41.9% in the same period. Singapore's electronics shipments slipped 25.4% in Dec 2008 from a year earlier, the 23rd consecutive drop. Sales of electronics products by companies including Chartered Semiconductor Manufacturing were worth S$4.18 billion ($2.8 billion) last month. Creative Technology on 2 Jan 2009 said it eliminated 2,700 jobs or almost half its workforce after demand for its music players tumbled. Non-electronics shipments, which include petrochemicals and pharmaceuticals, fell 17.4%. Pharmaceutical shipments plunged 51.1%.

channelnewsasia.com :

Singapore's key exports fell more than expected in December from a year ago, as recession-hit US and European consumers bought fewer goods from the city-state, the government said. Non-oil domestic exports tumbled 20.8%. It was the 8th straight month of contraction for the NODX, a closely watched barometer of the health of Singapore's open, trade-driven economy. Exports to all of Singapore's top 10 markets declined, with the exception of Japan. Exports to the European Union fell 34% while those to neighbouring Malaysia dropped 26%. Shipments to the United States fell 24%. Standard Chartered economist Alvin Liew said: "This is likely to be the most painful year in terms of external demand collapsing." Singapore became the first Asian economy to fall into recession in the third quarter of last year [2008].

- So I am backblogging again upon return from my trip. But from what I recall, this item seemed to give our governing body a heck of a shock. Non-oil domestic exports or NODX as it is commonly called, is a leading indicator of economic activity. In other words, what NODX does first, GDP usually follows later. Imagine what a GDP contraction of 10-20% would do to the country. In fact that is precisely what seems to be going on, as 2008 Q4 GDP figures have collapsed to -17% on an annualized basis.

Now we have local economists starting to yell stuff about "external demand collapsing". To their credit, the international peakoiler community has been yelling collapse for years. Mostly the doomers. Well. Especially the doomers. But did anyone ever listen to the doomer faction? Over on this end, I have been mumbling about it on one or two occasions. The multi-billion-dollar question that remains is, since we are all talking collapse here (of demand, exports, GDP growth, and many other indicators), what's next?

See also :

1. Singapore economy falling into technical recession as exports fall
2. Singapore economy in recession, GDP contracts 6.3% in Q3 2008, MAS ends currency gain policy
3. Singapore GDP contracted 6.8% annualized in Q3 2008, heads deeper into recession

(2009-01-29 20:32:11 SGT) [Biz] Permalink

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