Malaysia’s December exports up 6%, missing forecasts; trade surplus narrows to RM27.8b
Tan Ai Leng
[KUALA LUMPUR] Malaysia’s external trade expanded at a slower pace in December, with exports growth easing to 6 per cent year-on-year to RM131.9 billion (S$40.2 billion), according to data released by the Department of Statistics Malaysia (DOSM) on Wednesday (Jan 18).
This was lower than November’s 15.6 per cent growth, and also fell below the 9 per cent forecast in a recent Reuters poll of 12 economists.
Imports also grew 12 per cent year-on-year, reaching RM104.1 billion in December, lower than the economists’ forecast of 15.9 per cent.
Malaysia’s trade surplus for December narrowed to RM27.8 billion, falling nearly 12 per cent year-on-year but 25 per cent higher than November’s RM22.3 billion.
On a monthly basis, exports and trade balance increased by 1.7 per cent and 27.6 per cent respectively, while imports and total trade fell 3.5 per cent and 0.7 per cent respectively.
DOSM’s chief statistician Mohd Uzir Mahidin wrote in the report that Malaysia’s total trade reached “a new milestone” of RM2.8 trillion in 2022, which is the fastest growth since 1994 at 27.8 per cent.
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Last year, exports surged 25 per cent year on year to RM1.6 trillion, while imports jumped 31.3 per cent to RM1.3 trillion.
Malaysia’s trade surplus reached an all-time high at RM255.1 billion, with Uzir noting that this is the 26th consecutive surplus year for the country since 1998.
Giving his take on the performance in 2022, Malaysia’s International Trade and Industry Minister Tengku Zafrul Aziz said the trade performance is on an upward trajectory, boosted by higher external demand and strong commodity prices.
In a statement on Wednesday, he noted that Malaysia’s exports growth to major trading partners – Asean (31.8 per cent), China (9.4 per cent), the US (17.5 per cent), Europe (21.8 per cent) and Japan (29.6 per cent) – registered a new record high in 2022 as compared to previous year.
He said exports of manufactured, agriculture and mining sectors registered an all-time high with double-digit growth.
“Despite the challenging global landscape, we will continue to enhance the promotion of international trade and exports to reinforce business resilience and sustain economic growth momentum,” he added.
The minister, who is currently in Davos for the World Economic Forum, also stressed that the global outlook is gloomy for this year due to continuing geopolitical tensions, a high interest rate environment, inflationary pressure and soaring energy prices.
In view of the challenging environment ahead, he said the ministry and its trade-related agencies such as the Malaysia External Trade Development Corporation, will work together to safeguard demand and enhance the supply side as well as ensuring continuous market access for Malaysia’s manufacturing industry.
Although the annual growth of exports and imports growth was lower than analysts’ projection, MIDF Research is upbeat on the country’s trade performance this year as the ratifications of the Regional Comprehensive Economic Partnership and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership “will give a boost to external trade”.
The research firm noted that the reopening of China’s borders will be a catalyst to Malaysia’s external trade, as the world’s second-largest economy will soon see its import activities picking up, supported by local businesses.
China is Malaysia’s second largest export destination with a total export value of RM210.6 billion recorded in 2022.
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