Exports shrink for first time since November 2016

PETALING JAYA: Exports shrank for the first time since November 2016 after seeing an increase for 15 consecutive months, falling 2.0% to RM70.3 billion in February 2018, on the back of lower exports of electrical and electronic (E&E) products, liquefied natural gas (LNG), timber and timber-based products, and palm oil and palm-based products.
On a month-on-month basis, exports fell 15.1% from RM82.8 billion on the back of lower exports of E&E exports, LNG, timber and timber-based products, palm oil and palm-based products, crude petroleum and refined petroleum products.
According to the Department of Statistics, exports to countries such as Japan (-RM1.2 billion), China (-RM931.5 million), Indonesia (-RM918.3 million), Singapore (-RM596.3 million) and Mexico (-RM318.6 million) all declined.
Similar to exports, imports too saw their first drop in over a year, falling 2.8% from the previous year to RM61.3 billion with a major decline seen the intermediate goods segment (down 14.7%), despite an increase in imports of capital and consumption goods.
On a m-o-m basis, imports fell 16.2% from RM73.2 billion as intermediate goods, capital goods and consumption goods registered declines.
Malaysia’s total trade for February saw a y-o-y decline of 2.4% or RM3.2 billion to RM131.7 billion. Compared with the previous month, total trade shrunk by RM24.3 billion or 15.6%.
A trade surplus of RM9.0 billion was recorded in February 2018, an increase of RM286.2 million (+3.3%) from RM8.7 billion registered a year ago. When compared with the previous month, it fell RM648.7 million or 6.7%.
MIDF Research said the fall in exports and imports is mainly attributable to fewer working days and high base effect due to the Lunar New Year festival in February.
“Despite the fall, we opine that Malaysia’s external trade performance will rebound in coming months, leading to an overall easing path in 2018 amid upbeat momentum in global trade activities.”
It expects Malaysian exports to rise 9.3% this year, on upbeat global indicators and a rebound in commodity prices.