Malaysia’s trade surplus grew 15.3 per cent to RM100.86 billion in January to September from RM87.47 billion registered for the same period of 2018.

KUALA LUMPUR: Malaysia’s trade surplus grew 15.3 per cent to RM100.86 billion in January to September from RM87.47 billion registered for the same period of 2018.

This was the largest January-September trade surplus recorded in the last 10 years, analysts said.

They, however, cautioned that the trade performance would be quite vulnerable in the fourth quarter, after the country’s exports saw its largest monthly decline since October 2016.

“Export contraction fell to near the lowest rate in three years,” MIDF Research said when commenting on the latest trade numbers released by the International Trade and Industry Ministry today.

MIDF Research said in September, export had contracted 6.8 per cent year-on-year (oy), the hardest fall since October 2016.

“The second consecutive month of negative growth was due to weak performances in all major sectors,” the firm said, adding that higher base effect particularly in October 2018 would influence the overall performance in the fourth quarter of 2019.

“Nevertheless, we expect commodity-based sector products particularly liquefied natural gas exports to offset the less favourable impact from trade war in the second half of 2019,” it added.

The ministry reported that Malaysia’s total trade in September had decreased 2.7 per cent yoy to RM147.07 billion. This was brought about by lower trade with Singapore, Hong Kong, Taiwan, Australia, Thailand and the Netherlands.

However, higher trade was registered with China, India, South Korea, the United States and Saudi Arabia.

The ministry said September’s trade surplus was valued at RM8.34 billion, a decline of 46.5 per cent compared with September 2018. This marked the 263rd consecutive months of trade surplus since November 1997.

MIDF Research said for the first nine months of the year, exports growth had averaged at 1.1 per cent yoy.

In term of absolute value, monthly average of 2019 so far recorded at RM80.9 billion, still lower than RM83.7 billion in 2018.

“We expect further drop in exports growth in October 2019 due to high base effect factor. In addition, continuous decline in imports of capital and intermediate goods indicate weak prospects for future exports.

“With faltering trade globally derive from rising protectionism and loss of momentum in some major economies, especially in Europe, we do not foresee a huge comeback in the second half of 2019,” it added.