KUCHING: Malaysia’s exports remained strong for 11 consecutive months, with September registering double-digit growth of 14.8 per cent to RM78.26 billion compared to the same month of last year, said the Ministry of International Trade and Industry (Miti).
It said in the first nine months of 2017, exports surged by 21.3 per cent to RM690.25 billion from the corresponding period a year ago.
“Based on the performance so far, the full-year estimate of 16.6 per cent export growth as stated in the Economic Report 2017/2018 is well within reach.
“This would support the projected economic growth of between 5.2 per cent and 5.7 per cent for 2017,” said Miti in a statement.
Meanwhile, the team at MIDF Amanah Investment Bank Bhd (MIDF Research) saw that global demand show signs of moderation.
“We noticed global demand momentum is moderating and start to lose its steam,” it said yesterday. “For instance, Malaysia’s exports to China are growing at decelerating pace from peak of 51.5 per cent year on year (y-o-y) in May to 27.1 per cent y-o-y in September.
“Similar patterns were observed with other exports destinations such as US, Hong Kong, Australia and Asean. Among others, unfavorable base effect, geopolitical risks and market uncertainties are major dragging factors on global demand.”
In spite of this, MIDF Research foresee towards the end of year global demand will remain on upward bias given that year-end sales, uptick in tourism activity and launches of new electronic devices will occur during the months.
Zooming into China, the Mooncake Festival and Golden Week which befall in October are expected to lead to higher exports demand from the world’s second largest economy.
“We can expect exports to China and Hong Kong will rise strongly in October due to these two events,” the research team said.
MITI said the September export growth was driven by manufactured goods, which grew by 17.1 per cent or RM9.58 billion to RM65.62 billion, accounting for 83.9 per cent of Malaysia’s total exports.
The increase was supported mainly by higher exports of electrical and electronic (E&E) products which rose by 17.7 per cent to RM30.87 billion from last year.
“This was the nine consecutive months where exports of E&E products recorded a double-digit growth,” said MITI.
Apart from E&E products, double-digit expansion in exports was also recorded for petroleum products, the manufacture of metal, transport equipment, optical and scientific equipment, rubber products, iron and steel products as well as textiles, apparels and footwear.
With the emphasis on export promotion in the 2018 Budget, MITI said exports are expected to be sustained in 2018.
As for imports in September, it grew by 15.2 per cent to RM69.65 billion compared with September 2016. In the first nine months of 2017, imports amounted to RM620.66 billion, rising by 22 per cent.
Total trade expanded by 15 per cent to RM147.91 billion in September 2017. Malaysia’s trade in the first nine months of 2017 increased by 21.7 per cent to RM1.311 trillion compared with the same period of 2016.
In September, trade surplus rose to RM8.6 billion, making it the 239th consecutive month of trade surplus recorded since November 1997.
For the first nine months of 2017, the trade surplus amounted to RM69.59 billion, a 15.6 per cent increase over the same period of 2016.
On a month-on-month basis, total trade, exports and imports contracted by 4.3 per cent, 4.9 per cent and 3.7 per cent, respectively.
Even though exports growth in the third quarter of 2017 still on robust speed, MIDF Research viewed that Malaysia’s exports to moderate in the final quarter due to unfavourable base effect.
“In spite of this, continuous strengthening global demand and modest recovery in commodity price will support our trade performance this year,” it said.
“Protectionist threat, geopolitical tension and policy uncertainties in developed countries remains headwinds for global trade in the near term.”