Malaysia: Growth in exports slows for the seventh consecutive month
December 3, 2010
External demand for Malaysian exports is losing steam. In October, exports increased just 1.3% over the same month last year to reach MYR 55.0 billion (USD 17.7 billion). The weak reading represented the seventh consecutive month of decelerating export growth but, nonetheless, beat market expectations a 0.9% contraction. The deceleration was mostly driven by a fall in the export of electrical and electronic products (October: -5.9% year-on-year), which account for more than a third of total exports. Simultaneously, exports of timber and timber-based products dropped 12.3% over the same month last year. In contrast, palm oil and palm oil-based products rose 14.9% year-on-year (September: +12.3% yoy). Imports moderated as well, albeit less markedly, from an expansion of 14.6% in September to a 12.5% increase in October. Consequently, the trade surplus narrowed from MYR 7.0 billion (USD 2.3 billion) in September to MYR 6.8 billion (USD 2.2 billion) in October. As a result of the subdued recovery observed throughout the year, exports remain below pre-crisis levels. The 3-month sum remained virtually unchanged at MYR 158 billion (USD 50.7 billion) in October, which is well below the peak of MYR 186 billion (USD 55.8 billion) reached in September 2008.