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Malaysia's red-hot trade in April puts economy on solid growth path

KUALA LUMPUR: Malaysia keeps its economy red-hot after posting the highest monthly value for trade, exports, imports and trade surplus in April.

The country's total trade rose 21.3 per cent year-on-year to RM231.44 billion, the 15th consecutive month of double-digit growth.

Exports increased 20.7 per cent to RM127.49 billion, while imports grew 22 per cent to RM103.95 billion.

This led to a 15.7 per cent  jump in trade surplus to RM23.55 billion, Senior Minister and International Trade and Industry Minister Datuk Seri Mohamed Azmin Ali said in a statement today.

"The export growth was boosted by higher shipments of electrical and electronic (E&E) products, mainly semiconductors driven by global digitalisation trends," Azmin added.

Economists believe with solid trade numbers and strong economic confidence, Malaysia remained on steady course to achieve growth trajectory this year.

The country posted a gross domestic product (GDP) growth of five per cent in the first quarter of 2022, up from 3.6 per cent growth in the previous quarter.

"Juwai IQI stands buoyant on the GDP outlook to trade between 4.0 per cent and 5.0 per cent this year," its chief economist Shan Saeed told the New Straits Times.

Shan said Malaysia continued to move aggressively in trade and commerce with highest monthly targets achieved.

"These numbers speak solid effort from International Trade and Industry Ministry and Malaysian Investment Development Authority to maintain positive momentum in trade outlook."

Juwai IQI has previously shared that Malaysian trade would meander around RM1.3 and 1.5 trillion in 2022.

"With macroeconomic stability, opening up of economies, tourist arrivals are back and most importantly investors confidence in Malaysian economic outlook are the key variables for solid trade numbers," Shan said.

Putra Business School associate professor Dr Ahmed Razman Abdul Latif said the latest trade figures confirmed the continuous economic recovery for Malaysia this year.

"It highlighted the fact that positive quarterly GDP growth since Q4 2021 will continue until the end of the year, in line with the government's projection of between 5.3 per cent and 6.3 per cent. Nevertheless, precaution need to be made considering that global uncertainties," he cautioned.

Ahmed Razman said Russia-Ukraine crisis, ringgit weakening against the US dollar, food crisis, high inflation and disruption to global supply chain, among others, would pose an impact on the overall export and import growth of the country.

"Already in April, such export and import growth has been slowing down a bit compared to the previous month. Despite that, trade balance and current account remain positives and these indicators underlined the robustness of our economy," he added.

Elaborating on the performance, Azmin said exports to major markets notably Asean, China, the United States, the European Union and Japan recorded double-digit growth. 

"Exports to the US recorded the highest monthly value ever," he added.

On a monthly basis trade, exports, imports and trade surplus dropped 2.1 per cent, 3.1 per cent, 0.9 per cent and 11.6 per cent respectively.

From January to April 2022, trade climbed 22.9 per cent to RM856.21 billion from the same period last year.

Exports jumped 21.8 per cent to RM472.39 billion and imports were up 24.3 per cent to RM383.82 billion. Trade surplus grew 12.1 per cent to RM88.57 billion.

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