The month of August hasn’t been so good for the Singapore exports. The slowdown of the exports has highlighted to the fears that the Chinese economy would slow down and lackluster European demand will remain a drag on the Asian economy.
The weakness on the city state has come after the sluggish trade data from China, South Korea and Taiwan bolstering the picture that even the more robust regions of the global economy cannot escape the slump in the big Western countries. The main reason for the decline was the shipment of electronics falling 11% on year and reversing the July’s 5.7 % rise.
This has come due to the slow growth in the US and a tumble in the euro zone in to recession and a sharp slowdown in China which damped the demand for computer parts and other goods. The month of August is also a good month for Singapore’s electronics exports due to seasonal buying.
Alastair Chain, an economist at Moody’s Analytics said, “The takeaway here is that the tech sector hasn’t improved”. Chain added, “It doesn’t bode well for Taiwan, South Korea and other makers of electronics. I would think we are heading into a weak Christmas season.” The export drop of Singapore has dramatically increased the chance that the economy will slide in to recession this quarter.