Singapore export growth unexpectedly gains on chemicals, drugs

Singapore’s export growth unexpectedly accelerated in March as an increase in chemical and pharmaceutical shipments offset a decline in sales of electronics goods.

Non-oil domestic exports climbed 10% from a year earlier, after a revised 6.9% gain in February, the island’s trade promotion agency said in a statement today. The median estimate of 11 economists surveyed by Bloomberg News was for an increase of 5%.

 

Singapore’s dollar rose to a record today after a report last week showed the economy strengthened last quarter, aided by expansion in the manufacturing and services industries. While shipments to Japan fell in March after the north Asian nation’s strongest earthquake on record led to a nuclear power crisis, exporters are increasing sales to China, Europe and the U.S.

 

“The ongoing recovery in the U.S. and still resilient demand from Asia ex-Japan,” is limiting the impact of Japan’s quake on shipments, Irvin Seah, an economist at DBS Group Holdings in Singapore, said before the report. “While we remain optimistic about the growth and export outlook particularly in the second half, pockets of downside risks remain out in the horizon.”

 

Electronics shipments by companies including Venture Corp., Singapore’s biggest publicly traded electronics contract manufacturer, dropped 13.8% in March from a year earlier, after declining 12.8% the previous month.

 

PHARMACEUTICAL VOLATILITY

Non-electronics shipments, which include petrochemicals and pharmaceuticals, increased 24.5%. Pharmaceutical shipments added 4.4% after advancing 1.3% in February.

 

The performance of Singapore’s pharmaceutical industry is volatile as production swings by companies such as Sanofi- Aventis SA can cause industrial output to fluctuate from month to month. Drug companies sometimes shut plants for cleaning before making different products.

 

Singapore’s non-oil exports fell a seasonally adjusted 2.9% last month from February, when they gained a revised 2%, today’s report showed.

 

Non-oil shipments may increase 8% to 10% in 2011, the government predicts.