Singapore's Electronics Cluster

Changing composition of the electronics cluster…

The electronics cluster is a key component of Singapore’s manufacturing sector. Over the years, Singapore’s electronics cluster has moved up the value chain to high value-added activities. This can be seen at two levels. First, within individual segments of the electronics cluster, there has been a shift towards higher value-added activities. For example, in the data storage segment, the production of commodity disk drives has made way for high-end server drives and disk media. Second, the electronics cluster as a whole has seen high value-added segments rise in importance (Exhibit 1). For instance, the share of the data storage segment declined from 33 per cent in 1997 to 9.5 per cent in 2007. In contrast, the share of the semiconductors segment has tripled as Singapore moved into new areas such as 12-inch wafer fabrication and DRAM chip production. In 2009, the semiconductors segment will gain more diversified capabilities when NAND flash memory production, typically used in the latest consumer electronics products such as MP3 players, comes on-stream.

Electronics now has a less dominant share of Singapore’s exports…

As a small, open economy, a large share of our electronics output serves overseas markets. In 2007, electronics products1made up 45 per cent of Singapore’s total exports. Although electronics exports have increased since 1997, they now account for a smaller share of exports (Exhibit 2). In comparison, oil and chemicals exports have grown in importance during this period. Their combined share of exports rose from 18 per cent in 2001 to 30 per cent in 2007.

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