Oct exports post unexpected 2.6pc drop

By Rupa Damodaran

Malaysia's trade with other countries saw a downturn in October, with exports falling for the first time in 15 months.

Exports dropped 2.6 per cent to RM53.46 billion from a year earlier owing to lower demand for commodities and electrical and electronic (E&E) products.Imports, meanwhile, fell 5.3 per cent to RM43.84 billion.Total merchandise trade (exports plus imports) was RM97.3 billion.

The numbers came in far below market expectations and a Business Times poll, which had projected exports to moderate to 7.39 per cent and imports to grow at a slower pace of four per cent.

The Ministry of International Trade and Industry (Miti) said that compared with September, exports in October were down 14.2 per cent while imports fell 7.8 per cent."The decline in exports was mainly attributed to lower exports of E&E products and commodities, namely refined and crude petroleum as well as palm oil," Miti said.Major markets that registered declines were the US, Singapore, mainland China, Hong Kong and Australia.

The Asean region accounted for RM13.6 billion, or 25.4 per cent, of Malaysia's total exports in October, down 6.1 per cent from the same month last year because of lower exports of refined petroleum products as well as iron and steel products.

Exports to the US and the European Union declined mainly because of lower exports of E&E products.Exports to China dipped owing to lower exports of palm oil, crude rubber, metal and refined petroleum products.However, exports to India and the United Arab Emirates (UAE) increased in October.

Exports to India rose 10.7 per cent to RM2.45 billion, contributed mainly by higher exports of crude petroleum and palm oil.Exports to the UAE surged 52.6 per cent to RM1.13 billion, largely due to higher exports of jewellery and iron and steel products.

In the first 10 months of the year, Malaysia's trade surpassed the RM1 trillion mark to reach RM1.012 trillion, up 11 per cent.Exports expanded 13.9 per cent to RM565.66 billion, while imports increased 7.4 per cent to RM446.81 billion.

HSBC Bank economist Prakriti Sofat described the export data as the worst in more than 20 months, while import growth showed a five-year low.Electronics, which had a good run in the April-June period, showed a renewed weakness, contracting by nearly 13 per cent year-on-year