OCBC SME Index: Which sectors are the best and worst performers of 3Q23?

Overall, SMEs' performance and health remained in a state of contraction with a 49.6 reading.

The performance and health of small and medium enterprises (SMEs) in Singapore continued to deteriorate in 3Q23, according to the latest OCBC SME Index.

SMEs remained in a state of contraction for the third consecutive quarter in 3Q23 with a 49.6 reading. OCBC, however, said the reading improved by 0.6 points from 2Q23. 

“Against the backdrop of weak external demand, SME collections and payments dropped by 5.7% and 6.3% respectively in 3Q on a year-on-year basis,” OCBC reported.

Based on the latest reading, Business Services (53.6) recorded the biggest improvement amongst industries, followed by Food & Beverage (52.5) and Manufacturing (52.5).

On the other hand, outward-oriented industries like Transport and Logistics (50.1) Wholesale and Trade (51.0), and ICT (49.4) recorded declines in their respective readings.

“The OCBC SME Index is expected to stay slightly contractionary for the rest of the year as external headwinds persist. The ongoing slowdown in global electronics and decline in factory output will constrain growth in manufacturing and the trade-related sectors,” OCBC said.

“The consumer sectors will continue to lead the growth momentum for SMEs, benefitting from inbound tourism and seasonal spending,” OCBC added.