KUALA LUMPUR: Malaysia posted its largest trade surplus since 2012 as exports reached almost RM1 trillion last year.
Supported by stronger than expected export growth, the country’s total trade in 2018 remained resilient, expanding by 5.9 per cent to RM1.88 trillion from RM1.77 trillion in 2017, according to International Trade and Industry Ministry.
“Despite the uncertainties in the global environment, exports rose by 6.7 per cent to reach a value of RM998.01 billion, surpassing the forecast export growth of 4.4 per cent in the Economic Outlook 2019,” the ministry said in a statement today.
Imports increased by 4.9 per cent to RM877.74 billion.
Malaysia’s trade surplus widened by 22.1 per cent to RM120.27 billion, registering the fastest rate in 10 years and the largest trade surplus since 2012.
This was the 21st consecutive year of trade surplus since 1998, the ministry said.
The ministry has targeted an increase of five per cent collectively for trade, exports and imports this year.
“We are forecasting a growth of five per cent across these three segments despite expected slow down in global growth this year, on the back of multiple external factors such as policies uncertainties in major economies and rising interest rate,” Malaysia External Trade Development Corp (Matrade) incoming chief executive officer Datuk Wan Latiff Wan Musa said at a briefing on the trade figures here today.
“Five per cent is not a conservative target given that some research houses are expecting 3.6 to five per cent growth in trade this year,” he added.
Wan Latiff explained that the growth target was in line with what was set in the midterm review of the 11th Malaysian Plan (11MP).
“The revised target for trade surplus forecast in the 11MP is US$118.3 billion ringgit in 2020, compared with the initial target of US$57.3 billion. Despite the challenges, we we will have to meet this target,” he said.
Wan Latiff said the drivers for the target would be a more focused approach in in trade segment such as electronic and electrical (E&E), machinery, equipment and parts; optical and scientific equipment.
“We will also be focusing on trading with emerging markets that we see massive potential in such as Bangladesh, South Africa, Sri Lanka, Papua New Guinea, Peru, Qatar, Tunisia and Djibouti,” he said.
“In fact, in 2018 we saw exports to Bangladesh grew 29.5 per cent and Peru growing 50 per cent, with the latter mainly in palm oil-based manufactured products.”
International Trade and Industry Minister Datuk Darrell Leiking said Malaysia was able to capitalise on the ongoing US-China trade war.
“We saw our exports with China growing by the double digits at 10.3 per cent to RM138.9 billion last year. Despite China being a long-standing trade partner, we also know that this growth is also because Malaysia was fortunate enough to capture the divestment export, as a result of the trade war,” he explained.
.Malaysia's top five trade partners in 2018 were China (16.7 per cent), Singapore (12.9 per cent), United States (8.3 per cent), Japan (7.1 per cent) and Thailand (5.6 per cent).