Malaysia’s Export Growth Defies Global Trade Slowdown
Higher exports to China and the United States and more exports of manufactured goods helped Malaysia buck the global trend in July by posting surprise 1.7-percent growth in exports, beating estimates of yet another decline.
Malaysia’s export growth of 1.7 percent easily beat the forecast for a 2.5-percent drop in a Reuters poll of economists. In July, Malaysian exports rebounded from a contraction of 3.1 percent in June.
According to data from Malaysia’s International Trade and Industry Ministry, exports of manufactured goods jumped by 3.8 percent in July compared to July last year. Manufactured goods accounted for a total of 86 percent of all Malaysian exports in July 2019.
Exports of electronic and electrical goods, machinery, metal goods, chemicals and chemical products, and petroleum products boosted the exports of the ASEAN member.
Malaysian exports to one of its largest trade partners—China—rose by 3.8 percent in July 2019 compared to the same month of 2018, following a 12-percent annual plunge in exports to China in June 2019. Exports to the United States went up by 7.9 percent year on year in July 2019.
“Electrical and electronics continue to be the key driver with growth accelerating to 4.5% in July from -6.0% in the previous month. And within that, semiconductors continued to lead the way with 10.3% growth, a sustained outperformance in Asia lending credence to the view that Malaysia is moving up the electronics value chain,” ING’s Economist in Asia, Prakash Sakpal, said, commenting on Malaysia’s latest trade data.
Malaysia’s economy as a whole has recently shown better performance than expected, too.
Bucking a global trend of economic slowdown, Malaysia’s economic growth accelerated in the second quarter of 2019 to 4.9 percent from 4.5 percent growth in Q1 and beat analyst forecasts, thanks to higher household spending and private investment.