Malaysia enjoyed its 14th consecutive year of trade surplus last year, while its total trade was the highest ever recorded. What makes this international trading performance even more impressive is that it took place against a background of less than favorable global trading conditions.
A rise in demand from Asia for Malaysia’s goods and services mitigated the effects of slow economic recovery in the United States, the Eurozone debt crisis, unrest in West Asia following the Arab Spring, and supply chain disruptions caused by the tsunami in Japan and floods in Thailand. Asia absorbed 71.3% of Malaysia’s exports.
According to the government, Malaysia’s total trade reached 1.269 trillion ringgit ($422 billion) in 2011, an increase of 8.7% compared with 2010. Exports rose 8.7% to 694.55 billion ringgit, while imports increased 8.6% to 574.23 billion ringgit. The trade surplus was up 9.4% to 120.31 billion ringgit.
Malaysia’s main trading partners are China, Singapore, Japan, and the United States. It exports electronic equipment, petroleum and liquefied natural gas, wood and wood products, palm oil, rubber, textiles, and chemicals, and imports mostly manufactured goods, including electric and electronic products, chemicals and chemical products, and machinery, appliances, and parts.
“Given that SMEs play a key role in our economy, it is important that we help them to grow and succeed, both at home and abroad.” Datuk Seri Mustapa Mohamed, Minister of International Trade
and Industry |
China, the ASEAN nations, and India are seen as the major drivers of the country’s future export growth, and promotion of Malaysia’s goods and services is being stepped up in those markets. The
Malaysia External Trade Development Corp. (
Matrade) plans to undertake more than 120 export promotional activities this year.
Mustapa Mohamed, Minister of International Trade and Industry, says that to achieve its ambition to become a high-income economy by 2020 Malaysia needs to make itself more productive, innovative, and competitive. “Integral to this is our reaching out to companies and countries around the globe to market our products and convince our customers that we are business-friendly.”
The minister is particularly keen to see small and medium enterprises, SMEs, to promote their products. “Given that SMEs play a key role in our economy, it is important that we help them to grow and succeed both at home and abroad,” he says.
According to the U.S. Department of State, the United States is Malaysia’s fourth-largest trading partner, while Malaysia is the 22nd-largest trading partner of the United States. Trade between the two nations has grown to around $40 billion a year.
Malaysia has no bilateral free trade agreement with the United States, but joined negotiations for a Trans-Pacific Partnership free trade agreement in 2010. Efforts are being made to finalize the agreement this year.
Malaysian exports to the U.S. were down by 5.5% last year, a drop of 3.37 billion ringgit to 57.58 billion ringgit. There was a marked decline in sales of the electrical and electronic products that make up about half of U.S.-bound exports.
However, sales of semi-conductor devices continued to grow, along with palm oil, chemicals and chemical products, textiles and clothing, and rubber products, and recent indications that the world’s largest economy is on the road to recovery hold out better prospects for exports next year.
Exports to India surged by more than 34% last year, but China remains Malaysia’s largest trading partner. Last year also saw China displace Singapore for the first time as Malaysia’s largest export market. According to MITI, exports to China reached a value of 91.25 billion ringgit, an increase of 13.9% or 11.14 billion ringgit, compared with 2010.
Exports to co-member states in the Association of Southeast Asian Nations (ASEAN) account for almost a quarter (24.7%) of Malaysia’s total exports.
Last year, exports increased to all ASEAN markets, except Laos, with increased sales of refined petroleum products, palm oil, chemicals and chemical products, as well as machinery, appliances and parts pushing the total value up 5.8% to 171.54 billion ringgit.
This upward trend in inter-regional trade is set to continue as the members of ASEAN move towards establishing a single market by 2015.
0 COMMENTS