Winter has come for Singapore’s struggling exporters

And it’s not ending anytime soon.

There was a time when Singapore’s exporters could rely on non-electronic products to keep their spirits up even as electronics exports drop. But all that is now in the past, as illustrated by the sharp 7.2% year-on-year drop in non-oil domestic exports (NODX) in December.

According to DBS, exporters are in for a long period of negative export growth on back of weak global demand, the continued plunge in oil prices and the shaky economic prospects of Singapore’s key trading partners.

“Exporters are indeed undergoing challenging times. Beyond the medium term structural decline, deceleration in China and an uneven recovery in the US are still weighing down on export performance,” DBS said.

Apart from these factors, the Singapore dollar’s resilience against regional currencies such as the ringgit and the yuan will continue to erode export competitiveness in the near-term.

“[The December NODX] is another reminder about the harsh environment out there. The implications are that the GDP figures for 4Q15 could be revised downwards and that the exchange rate policy is still on an easing bias. More importantly, such dire economic conditions will likely persist for the coming months judging from the outlook of the global economy,” DBS noted.