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Singapore’s non-oil domestic exports grew 9.3% year-on-year in January 2026, driven by surging demand for AI-related electronics, Enterprise Singapore reported Monday. While the fifth consecutive month of expansion underscored the city-state’s deepening role in the global AI supply chain, the result fell short of market expectations of 12.1-13.5% growth — highlighting an increasingly lopsided recovery.
Electronics Surge Masks Broader Weakness
The headline number was powered almost entirely by electronics, which expanded 56.1% — more than double December’s growth rate. Within that category, integrated circuits surged 80.5%, disk media products jumped 70.2%, and personal computers rose 24.0%. The figures reflect the ongoing global race to build out AI infrastructure, with Singapore positioned as a critical node for chip design, testing, and redistribution across Asia Pacific.
Non-electronics exports, however, contracted 3.0% — a sharp reversal from the 0.8% growth recorded in December. The decline was led by specialised machinery, down 15.6%, food preparations which collapsed 49.2%, and petrochemicals falling 24.5%. The divergence between electronics and everything else is widening, raising questions about how sustainable Singapore’s export growth is if it remains dependent on a single sector.
Below Consensus
Despite the strong electronics performance, the 9.3% headline missed Reuters’ poll forecast of 12.1% and other estimates projecting 13.5%. The shortfall is notable because it comes just days after the government upgraded its 2026 outlook. The Ministry of Trade raised GDP growth projections to 2-4% from 1-3%, and EnterpriseSG lifted its full-year NODX forecast to 2-4% from 0-2%, citing stronger-than-expected momentum from Q4 2025 when GDP expanded 6.9% year-on-year.
The miss suggests that while the trajectory remains positive, the pace of acceleration may be plateauing. For a trade-dependent economy where exports account for a significant share of GDP, the gap between expectations and reality matters — particularly as global demand patterns shift amid ongoing tariff uncertainties and intensifying competition in the AI chip sector.
Trade Geography Shifts
The geographic distribution of exports showed mixed signals. Shipments to China, Hong Kong, and the European Union increased in January, while exports to the United States and Indonesia declined. The US weakness is particularly significant given that American tariff policies have disrupted Singapore’s export flows intermittently since late 2025 — shipments to the US had already dropped 12.5% in October before rebounding 106% in November on front-loading effects.
Singapore’s role as a re-export hub, however, continues to strengthen. Non-oil re-exports surged 51.4% in January, with electronic re-exports up 69.4% and non-electronic re-exports rising 24.2%. This reinforces the city-state’s position as the logistics and redistribution backbone for Asia’s rapidly evolving technology supply chains. Total merchandise trade expanded 23.8%, extending the 12.3% rise recorded in December.
What Comes Next
The January data presents a complex picture. The AI electronics boom is real and accelerating — IC exports nearly doubled year-on-year. But the non-electronics contraction, the consensus miss, and the geographic volatility suggest that Singapore’s trade recovery remains fragile outside its technology corridor. With the government projecting moderate expansion through 2026 and geopolitical risks from US trade policy still unresolved, the question is whether AI demand alone can carry the weight of an entire export economy.
Sources: Economic Times, Thestar
