Malaysia: Decline in merchandise exports softens in October
Merchandise exports fell 5.4% over the same month last year in October, on the heels of September’s 16.4% dive. October’s figure marked the softest decline since May 2023. Additionally, merchandise imports fell 1.3% over the same month last year in October (September: -13.7% yoy), marking the strongest reading since February 2023.
Meanwhile, the merchandise trade balance deteriorated from the previous month, recording a USD 2.7 billion surplus in October (September 2023: USD 5.2 billion surplus; October 2022: USD 3.9 billion surplus). Lastly, the trend pointed down, with the 12-month trailing merchandise trade balance recording a USD 53.0 billion surplus in October, compared to the USD 54.2 billion surplus in September.
Analysts at the EIU commented on the outlook:
“The country will become more embedded in the global electronic goods supply chain during our forecast period. Currently, it manufactures and assembles components such as semiconductors and automotive and computer parts. As Malaysia continues to benefit from “China+1” corporate strategies, to hedge against US-China rivalry, we expect it to attract more upstream investment in the electrical and electronics industry. Conversely, we anticipate a reduction in palm oil exports to the EU in 2024-28, after the European bloc passed a deforestation law earlier this year.”