Friday, May 6, 2011

Record exports in March

PETALING JAYA: Malaysia’s exports reached a new high of RM64.06bil in March, up 7.8% from the same month last year, International Trade and Industry (Miti) Minister Datuk Seri Mustapa Mohamed said yesterday.

“The increase in exports in March 2011 of RM4.64bil from a year ago was largely contributed by higher exports of electrical and electronic (E&E) products, refined petroleum products, palm oil, crude rubber as well as chemicals and chemical products,” he said in a statement.

Compared with February, increases in exports were registered in all product sectors.

“However, the largest contributors to the increase were E&E products, palm oil, crude rubber, chemicals and chemical products, machinery, appliances and parts, manufactures of metal, liquefied natural gas (LNG), refined petroleum products, rubber products and crude petroleum,” Mustapa said.

On a month-on-month basis, exports in March increased by 23.7%. During the first quarter of 2011, total exports increased 3.5% to RM170.67bil compared with the fourth quarter of last year.

According to Miti statistics, China, Singapore, Japan, the US and Hong Kong were the top five export destinations, accounting for 50.9% of Malaysia’s total exports in March.

RAM Holdings Bhd group chief economist Dr Yeah Kim Leng said the exports figures were a surprise and above expectations, adding that he was optimistic about intra-regional exports going forward.

“Global demand, although still weak, won’t derail our exports,” he said.

According to Miti statistics, exports to Asean were valued at RM15.48bil in March, accounting for 24.2% of Malaysia’s total exports.

Yeah added that the weakening of the US dollar would “reshape the global pattern of demand.”

“(The weaker US dollar) will improve US exports and for countries that have seen their currencies appreciating, it would improve their exports.

“The weakening of the US dollar will also help boost their exports and strengthen domestic demand in Asian countries that have seen an appreciation in their currencies,” said Yeah.

The ringgit continued to hold steady and was hovering around RM3.01 per US$1 yesterday. The local currency hit a 13-year high when it dropped below the RM3 mark late last month.

Some economists expect it to hit RM2.93 against the dollar within six months.

Economists had previously told StarBiz that a strengthening ringgit would not pose a problem for exports so long as it rose in tandem with other currencies in the region.

Yeah also believes that the earthquake that hit Japan in March will not have a substantial impact on Malaysia’s exports to the country, going forward.

“Reconstruction efforts (in Japan) have begun and there is a demand (for commodities) for their reconstruction efforts,” he said.

Yeah added that the level of exports (for Malaysia) in the second of quarter of 2011 was expected to maintain, underpinned by continued strong global commodity demand.

Meanwhile, imports in March rose by 12.1% to RM50.53bil, resulting in a total trade of RM114.59bil, up 9.6% from a year ago.

A trade surplus of RM13.52bil was registered, making it the 161th consecutive month of trade surplus since November 1997, according to Miti.

On a month-on-month basis, imports rose by 28.9% and total trade expanded by 25.9%.

During the first quarter, imports contracted 3.4% to RM134.59bil compared with the fourth quarter of last year while total trade increased by 0.4% to RM305.26bil.

Compared with the first quarter of 2010, exports and imports in the first quarter of 2011 were higher by 7.5% and 12.4% respectively, while total trade increased by 9.6%.

Kenanga Investment Bank Bhd economist Wan Suhaimie Saidi said domestic demand would “hold up” in light of the good trade numbers.

“Judging from the import numbers, domestic demand is supporting growth. We believe gross domestic product could grow by 4% in the first half of the year,” he said.

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