NODX Growth Seen Steady in 2025 Despite Slow January Start

Singapore's non-oil domestic exports (NODX) got off to a rocky start in 2025, with a 2.1% decline in January. However, experts remain optimistic about the year's growth prospects, projecting a steady 1.0% to 3.0% increase. This article explores the factors contributing to the slow start and the expected stability in NODX growth for the year.



January's Slump: A Blip or a Trend?

The January decline in NODX was primarily driven by a 4.8% drop in non-electronics exports, while electronics exports grew by 9.6%. Key sectors that contributed to the decline included pharmaceuticals (53%), specialised machinery (9.9%), and miscellaneous manufactured articles (20%). Additionally, NODX to certain markets, such as China, Indonesia, and the European Union, also dropped.

However, it's essential to note that January's performance may not be indicative of the entire year's trend. The slow start could be attributed to various factors, such as volatile segments, supply chain disruptions, or temporary demand fluctuations. As such, it's crucial to monitor the situation closely and assess the underlying causes.

Factors Driving Expected Stability

Several factors contribute to the expected stability in NODX growth for 2025:

1. Faster global merchandise trade growth: The World Trade Organisation (WTO) projects faster global merchandise trade growth in 2025 compared to 2024, which could positively impact Singapore's NODX.
2. Resilience in the electronics sector: Despite the moderation in electronic NODX growth in the latter part of 2024, the sector remains a significant contributor to Singapore's exports. The growth in electronics exports, particularly in integrated circuits, personal computers, and disk media products, could help maintain stability in NODX in 2025.
3. Recovery in non-electronics exports: Although non-electronics exports experienced a decline in January 2025, the sector has shown growth in previous months. A recovery in this sector could contribute to the overall stability in NODX in 2025.
4. Expansion in NODX to certain markets: While NODX to some markets, such as China and Indonesia, declined in January 2025, exports to other markets like Hong Kong, the United States, and Taiwan surged. This diversification in export destinations could help maintain stability in NODX in 2025.

Looking Ahead: Opportunities and Challenges

As we move forward, it's essential to keep an eye on the following opportunities and challenges:

1. Opportunities: Diversifying export markets, promoting non-electronics sectors, and addressing supply chain disruptions can help maintain steady NODX growth in 2025.
2. Challenges: Volatile segments, moderation in electronic NODX growth, and shifts in global supply chains may pose obstacles to NODX growth.

In conclusion, while January's NODX performance was disappointing, experts remain optimistic about the year's growth prospects. By addressing the factors contributing to the slow start and capitalising on the opportunities, Singapore can work towards maintaining steady NODX growth in 2025. Keep an eye on the evolving trends and stay informed about the latest developments in the NODX landscape.