Sept exports shrink more than expected

 

Exports in September shrank more than expected, amplified by last year's strong showing in commodity shipments, and it also reinforced views that the global economic recovery is still fragile.

According to the International Trade and Industry Ministry yesterday, exports declined by 24.2 per cent while imports were lower by 20.2 per cent. The trade surplus was RM9.27 billion.

Economists polled expected a 20.92 per cent fall in exports and a 17.66 per cent dip for imports.

"External demand recovery remains frail, reflecting the lacklustre electronics and manufactured products exports performance," said Standard Chartered Bank South East Asia economist Alvin Liew.

The fall in September exports were mainly due to lower exports of crude petroleum, electrical and electronic (E&E) products, iron and steel products, jewellery as well as textiles and clothing.

Liew also noted that while the sharp decline in imports showed a good trade balance for now, it also indicated long-term concerns as to whether companies are postponing investments.

"This may reduce the manufacturing sector's capacity in the medium and long term, preventing it from reaping the benefits of an eventual recovery in demand," he added.

Meanwhile, MITI announced that electrical and electronics exports to Germany and China increased in September.

Other increases in the month included refined petroleum products, transport equipment, palm oil and liquefied natural gas (LNG).

Singapore, China, the US, Japan and Hong Kong accounted for 52.9 per cent of Malaysia's total exports.

Exports to the US were lower by 35.2 per cent from a year ago, due to lower exports of E&E products, while exports to the European Union (EU) rose 6.7 per cent.