Malaysia’s trade contracts 16pct in April, first deficit after 269 months of surplus

Malaysia’s trade in April dropped 16.4 per cent year-on-year to RM133.34 billion from RM159.5 billion due to Covid-19 pandemic which caused major disruptions to global supply chain.

The Ministry of International Trade and Industry (MITI) said exports contracted 23.8 per cent year-on-year to RM64.92 billion from RM85.16 billion a year ago.

Imports decreased 8.0 per cent year-on-year to RM68.42 billion from RM74.35 billion.

The country’s balance recorded a deficit of RM3.49 billion in April, after 269 consecutive months of surplus on account of a higher contraction in exports compared to imports.

Lower trade was recorded particularly with Singapore, Thailand, India, the United States (US), Japan, Viet Nam and Saudi Arabia.

Compared to March 2020, trade and exports slipped by 9.9 per cent from RM147.92 billion and 19 per cent from RM80.12 billion respectively, while imports increased by 0.9 per cent from RM67.80 billion.

Major exports in April were electrical and electronics product (RM25.91 billion; 39.9 per cent), petroleum products (RM5.42 billion; 8.3 per cent), chemicals and chemical products (RM3.89 billion; 6.0 per cent), palm oil and palm oil-based products (RM3.44 billion; 5.3 per cent) and liquefied natural gas (RM2.86 billion; 4.4 per cent).

Malaysia’s trade during the first four months of 2020 dropped 3.5 per cent to RM573.75 billion compared to the RM594.67 billion recorded in the corresponding period of 2019.

Exports eased 5.5 per cent to RM303.61 billion from RM321.22 billion and imports declined 1.2 per cent to RM270.14 billion from RM273.45 billion.

Trade surplus was valued at RM33.47 billion, a decline of 29.9 per cent from RM47.76 billion recorded in the same period of 2019.

International Trade and Industry Minister Datuk Seri Mohamed Azmin Ali said declines in both exports and imports had been expected.

This was given that most countries around the world were under some form of lockdown to contain the spread of Covid-19.

He said this had caused major disruptions to the manufacturing activities and movement of goods globally.

Nevertheless, exports of some products such as iron and steel, rubber gloves and refined palm oil recorded increases.

“Malaysia’s exports are expected to improve in the coming months as the government allowed more industries to resume operations and at full operating capacity since May 4.

“Similarly, companies in other countries are also ramping up their business operations. This will boost trade activities between Malaysia and other countries,” he said.