Double-Digit Growth in Exports to Major Markets

PETALING JAYA: Malaysia’s exports to all major markets, namely Asean, China, the United States, the European Union and Japan, recorded double-digit expansion in June.

The strong exports turbo-boosted Malaysia’s total trade performance, which surpassed RM1 trillion in value in just the first six months of the year.

According to the International Trade and Industry Ministry (Miti), this was the shortest period to breach the RM1 trillion milestone.

Data provided by the Statistics Department showed that exports to the five major markets in June totalled RM72.25bil, exceeding imports of RM57.8bil.

The markets collectively contributed almost 69% of June’s total exports.

Miti announced yesterday that the country’s total exports in June grew for the 10th consecutive month year-on-year (y-o-y) since September 2020, registering a strong growth of 27.2% to RM105.47bil.

This was the third time exports exceeded the RM100bil-mark.

MIDF Research described the exports growth as “better-than-expected”, despite June being the first month of full lockdown.

Meanwhile, total imports in June increased by 32.1% to RM83.23bil and the trade surplus expanded by 11.7% to RM22.24bil.

“Trade, exports and imports recorded the second highest monthly value thus far after April 2021.

“This was also the highest monthly value for the month of June and double-digit growth for five successive months,” according to Miti.

The strong export growth in June was contributed by the high demand for petroleum products, rubber products as well as electrical and electronic (E&E) products.

The major driver of E&E products exports is the electronic integrated circuits used in the production of smartphones, cars, computers and home appliances.

Miti said that in June 2021, exports for all three sectors recorded strong double-digit expansion compared to the same month last year.

“Exports of manufactured goods which accounted for 86.6% of total exports, increased by 25.8% y-o-y to RM91.3bil and was the seventh consecutive month of double-digit growth.

“Export products which expanded more than RM1bil were seen for petroleum products, E&E products, rubber products, chemicals and chemical products, palm oil-based manufactured products as well as manufactures of metal.

“Exports of agriculture goods (8.3% share) grew by 40% to RM8.81bil compared to June 2020 driven mainly by higher exports of palm oil and palm oil-based agriculture products.

“Exports of mining goods (4.7% share) rose by 32.9% y-o-y to RM4.96bil, registering double-digit growth for three straight months. The expansion was underpinned by higher exports of crude petroleum and liquefied natural gas,” the ministry said.

On imports in June, Miti pointed out that the imports of intermediate goods, valued at RM43.71bil or 52.5% of total imports, increased by 25.3% y-o-y.

This was following higher imports of processed industrial supplies particularly copper and articles.

Capital goods, valued at RM8.57bil or 10.3% of total imports, grew by 15.2% y-o-y, due mainly to higher imports of parts for machinery and mechanical appliances.

In addition, consumption goods rose by 19.2% y-o-y, led by higher imports of processed food and beverages mainly for household consumption, especially meat and edible meat offal.

Consumption goods are valued at RM7.35bil or 8.8% of total imports.

For the first half of 2021, Malaysia’s exports rose by 30.2% y-o-y to RM585.56bil and imports increased by 21.1% to RM470.53bil.

Meanwhile, trade totalled RM1.056 trillion, an expansion of 26% from the same period last year.

“This was the highest half year value recorded for trade, exports and imports. Trade surplus surged by 87.7% to RM115.04bil,” said Miti.

Looking ahead, MIDF Research has maintained its exports and imports growth projections at 13.5% y-o-y and 12.7% y-o-y respectively.

“Looking at the first half of 2021 (H1 2021), trade performance has been stronger than expected, indicating a further improvement in exports and imports from H2 2020.

“We believe the lockdown will be a temporary drag before activities will be allowed to resume in the latter part of the year as more people are getting vaccinated, increasing the chance to reach herd immunity this year.

“Going forward, we expect the base effect to fade and growth will be more moderate and normalised going into H2 2021,” it said in a note yesterday.

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