Malaysia: Merchandise exports rise at a milder rate in October
Merchandise exports climbed 2.0% year-on-year in October, following Septembers 19.3% upturn. Octobers outturn marked the softest expansion since October 2020. Meanwhile, merchandise imports jumped 14.6% in annual terms in October (September: +22.0% yoy), marking the weakest result since February 2022.
As a result, the merchandise trade balance deteriorated from the previous month, recording a USD 3.9 billion surplus in October (September 2022: USD 7.0 billion surplus; October 2021: USD 6.4 billion surplus). Lastly, the trend pointed down, with the 12-month trailing merchandise trade balance recording a USD 59.2 billion surplus in October, compared to the USD 61.7 billion surplus in September.
Analysts at the EIU commented on the outlook:
“Malaysia’s trade surplus will remain large in 2023-27. The composition of exports and imports will remain similar to the historical period. Shipments of electronic and electrical goods will continue to exceed those of mineral fuels by a wide margin. […] The services account will remain in deficit; this imbalance highlights Malaysia’s status as an export-oriented economy, with transport and insurance costs continuing to form a large part of the services debit bill. […] The primary income account will also stay in the red in 2023-27, reflecting the repatriation of profits by foreign firms with local operations.”