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| Malaysia's export slump deepens amid 'bumpy' economic recovery |
| 06-NOV-2009 Intellasia | Bloomberg |
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| 6 Nov, 2009 - 7:00:00 AM |
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Malaysia's export decline deepened in September as commodity prices fell from a year earlier and electronics sales slid.
Overseas shipments dropped 24.2 percent from a year earlier to 47.24 billion ringgit ($13.8 billion) after falling a revised 19.9 percent in August, the trade ministry said in a statement in Kuala Lumpur today. The median estimate in a Bloomberg News survey of 17 economists was for a 21 percent decline.
"Exports remain weak due to lower commodity prices for palm and crude oil compared with a year ago," said Alaistair Chan, an economist at Moody's Economy.com in Sydney. Overseas sales "are likely to improve in the coming months," he said.
Southeast Asia's third-largest economy is vulnerable to fluctuations in palm oil and petroleum prices because commodities make up more than 20 percent of its exports. prime minister Najib Razak said yesterday the nation may emerge from its recession earlier than the government previously predicted as the outlook for growth in the third quarter "brightened."
Malaysia's "export value will continue to grind forward on the back of the steady improvement in the external environment," said Irvin Seah, an economist at DBS Bank Ltd in Singapore. Recoveries are usually "bumpy and it's never a flight to the moon," he said.
Crude oil was about 30 percent cheaper at the end of September compared with a year earlier. Prices have since risen above $80 a barrel. Palm oil costs also fell.
Malaysia's petroleum exports plunged 53.3 percent in September from a year earlier. Liquefied natural gas shipments declined 35.6 percent and palm oil sales dropped 25.5 percent.
Economic Forecasts
Shipments to China rose 9.8 percent in September from a year earlier amid higher electronics and crude oil sales, the trade ministry said. Exports to Singapore and the US fell.
Malaysia raised its 2009 economic forecast last month, joining neighbours including Singapore and Thailand in saying this year's slump is easing faster than expected as the world recovers from its recession.
The government expects the $195 billion economy to shrink 3 percent this year, before expanding between 2 percent and 3 percent in 2010. That compares with the World Bank's projection for a contraction of 2.3 percent in 2009 and growth of 4.1 percent next year, according to a report published today.
"Consumption and fixed-investment growth will remain relatively subdued due to uncertainties about the global outlook, the efforts of fiscal consolidation and still-low levels of capacity utilisation," the lender said. "The turnaround in the inventory cycle is expected to be a main driver of growth."
Electronics Fall
Sales of electrical and electronics products by companies including Malaysian Pacific Industries Bhd. fell 19.4 percent in September from a year earlier, compared with a 13.1 percent decline in August.
Malaysia's imports dropped 20.2 percent in September from a year earlier to 37.97 billion ringgit, narrowing the trade surplus to 9.27 billion ringgit.
Exports fell 23 percent to 394.34 billion ringgit in the nine months through September while imports contracted 23.5 percent to 308.44 billion ringgit, resulting in a trade surplus of 85.9 billion ringgit, the report showed.
http://www.bloomberg.com/apps/news?pid=20601080&sid=aHjnoyDCll.Q
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