SINGAPORE – Smaller firms that rely on export markets took a hit in the second quarter, while those that deal more with domestic consumers fared better, a new report noted.
An index compiled by OCBC Bank using data on more than 100,000 small and medium-sized enterprise (SME) customers came in at 49 points in the three months to June 30, down from 49.9 points in the first quarter. A reading below 50 indicates a deterioration in business activity.
It also pointed to reduced sales revenue and lower expenses, both of which suggest a weakening environment.
Domestic sectors performed well, with building and construction, education and business services remaining above 50 points – in expansion territory.
But firms exposed to the global economy suffered, particularly transport and logistics, wholesale trade, and information and communications technology.
They were below the 50-point mark, along with SMEs in the resources, manufacturing, retail and healthcare sectors.
OCBC global commercial banking head Linus Goh said the index, which began two years ago, has indicated that Singapore’s SMEs have been performing well.
“When the economy reopened last year, local businesses had emerged in much better shape than their regional peers, buoyed by government initiatives rolled out during the pandemic,” he added.
