Visitors take photographs at the Merlion park in Singapore on August 13, 2019. - Photo by Roslan RAHMAN / AFP
SINGAPORE: Singapore’s total manufacturing output rose for a third straight month in September, though the key electronics industry saw a slower pace of growth.
Economists told The Straits Times that Singapore’s manufacturing recovery may stay on track despite the economic and geopolitical risks to global trade.
With the smaller rise in electronics production, total output grew 9.8% from a year ago, down from the revised 22% jump in August, data from the Economic Development Board (EDB) on Oct 25 showed.
Excluding the volatile biomedical manufacturing, factory output rose 4.5%.
On a seasonally adjusted month-on-month basis, output was largely unchanged from August.
Excluding biomedical manufacturing, it dropped 7.6%.
UOB associate economist Jester Koh called September’s growth “remarkably resilient” and said it might mean an upward revision to Singapore’s gross domestic product for the third quarter of the year.
Meanwhile, Maybank analysts Chua Hak Bin and Brian Lee said the electronics recovery might remain intact despite the slower output growth in September.
“That said, there are risks to Singapore’s export and manufacturing recovery on the horizon.
“These include more tariff barriers and a bigger US-China trade war (which could ensue from a Trump election win in November), an escalation of geopolitical conflicts in the Middle East, and a United States economic slowdown,” they said.
DBS Bank economist Chua Han Teng said that an escalation of ongoing geopolitical conflicts and protectionist measures could potentially dampen the pace of Singapore’s manufacturing and trade growth.
These measures could disrupt global supply chains and result in a more fragmented trade landscape, he added.
EDB’s September data showed that all industries saw higher output, except for transport engineering.
Electronics production, which accounts for nearly half of Singapore’s manufacturing output, grew 1.9% in September, down from a hefty 50% in August.
But DBS’ Chua said: “The global semiconductor industry is recovering well, and the upcycle has more runway, which will bode well for Singapore’s electronics firms.
“We continue to expect Singapore’s electronics firms to capitalise on the opportunities driven by the replacement of smartphones and PCs, as well as the broadening adoption of artificial intelligence applications.”
He added that external demand for Singapore’s electronics products remains supported, with new export orders growing for the 10th straight month through September.
Within electronics, semiconductor output grew 3.1% year-on-year, compared with a 55.7% surge in August, while the infocomms and consumer electronics segment contracted 23%, reversing the previous month’s 28.5% expansion.
Computer peripherals and data storage production rose 25.8%, while the other electronic modules and components grew 4.4%.
Overall, the electronics cluster grew 4.6% for the period from January to September 2024, compared with the same period a year ago.
Biomedical manufacturing output jumped 62% year-on-year, led by pharmaceutical production surging 143.9%.
The medical technology segment grew 0.9% to meet continued export demand for medical devices. — The Straits Times/ANN
