Malaysia March exports up 10.3pc

By Rupa Damodaran
Published: 2009/05/09


MALAYSIA'S exports in March continued to fall in year-on-year terms but at a slower pace, decreasing 15.6 per cent.Imports fell 28.7 per cent, resulting in total trade dropping 21.6 per cent.

Compared to February, however, March exports rose 10.3 per cent to RM43.65 billion, while imports increased 13.3 per cent to RM31.14 billion.International Trade and Industry Minister Datuk Mustapa Mohamed said it was still too early to predict a recovery even though the trade figures have been growing on a month-to-month basis.

"We have been talking to trade associations, business leaders, and we gather that there are some signs of orders picking up in the country. But there are no solid numbers yet," he told a media briefing on the first quarter trade performance in Kuala Lumpur yesterday."

The numbers are still quite weak at this point and we are not at the inflection point yet and it will take some time. In Penang, some small and medium enterprises (SMEs) are beginning to see a small pick-up in orders, but we need to monitor (the situation) closely."

Mustapa said he was encouraged that the rate of decline in exports in January-Marchad slowed."But any kind of recovery in the export numbers can only be expected by the end of the year."Although declines were registered in exports in the first three months of this year, there was a marked deceleration in the rate of decline."

Forecasts are determined by the prices and volume of our products exported and on both counts we are suffering, as seen in the petroleum and palm oil (prices, which are half of last year's levels). The trend of prices has firmed up, but they are still at low levels," he added.

With the exception of Japan and Australia, exports to all major markets rose in March, with the highest increase seen in exports to China and Hong Kong.March trade surplus was RM12.5 billion, the 137th consecutive month of surplus since November 1997.Total trade was RM210.27 billion in January-March, down 24 per cent from a year earlier.

Exports fell 20 per cent to RM121.47 billion, while imports dropped 28.9 per cent to RM88.8 billion for a first quarter trade surplus of RM32.67 billion.Standard Chartered Bank economist Alvin Liew said that it was still too early to say that the manufacturing sector was poised for recovery, especially if the global recovery was prolonged and very shallow."

One positive factor is that the sharp decline in imports should help the trade surplus outlook in 2009."However, the sharp decline in imports may also signal that companies may be significantly delaying capital investments and that will be detrimental to Malaysia's manufacturing capacity to reap the benefits of future demand recovery when the global economy recovers," he said.