Azmin: Malaysia’s exports rebounded in second half of 2020

KUALA LUMPUR: Malaysia’s external trade performed fairly well, with exports rebounding in the second half of 2020 as compared to the negative growth recorded in the first half of the year, despite the challenges presented by the Covid-19 pandemic.

Senior Minister (International Trade and Industry) Datuk Seri Mohamed Azmin Ali said this could be attributed to the progressive opening of the economy and gradual recovery of external demand.

“Year 2020 was challenging to global trade as a result of the stringent lockdown measures imposed across the board due to the Covid-19 pandemic.

“This directly caused major disruptions to global supply chains, especially the movement of goods and services, and severely affected manufacturing activities,” he said in a statement today.

Despite this, he said, Malaysia’s exports in 2020, valued at RM980.99 billion, declined marginally by 1.4 per cent compared to the preceding year, in tandem with the unfavourable external environment due to the impact of the Covid-19 pandemic.

He pointed out that December was the highest monthly value recorded for 2020.

He also said while lower exports were recorded to Thailand, India, Bangladesh, Vietnam and Japan, higher exports were registered to China, the United States, Singapore and Hong Kong.

“Exports rebounded in the second half of 2020, increasing by 4.8 per cent. This was a significant improvement from a 7.9 per cent contraction in the first half of 2020 as the economy progressively reopened and external demand gradually recovered.

“Exports to China recorded a new high in 2020 and similar momentum was reported for the US which posted the largest value in the last decade.

“There was significant export growth to emerging markets, notably Costa Rica, Kazakhstan, Kenya, Nigeria, Ghana and Cote d’Ivoire.

“Rubber products, electrical and electronics products, as well as palm oil and palm oil-based agriculture products registered strong export expansion.”

Azmin further said Malaysia’s trade surplus widened by 26.9 per cent to RM184.8 billion in 2020, the highest trade surplus recorded, thus maintaining a sustained surplus trend for 23 consecutive years since 1998.

Total trade in 2020, which amounted to RM1.777 trillion, contracted by 3.6 per cent compared to 2019; while imports totalled RM796.19 billion, a decline of 6.3 per cent, he said.

He said Malaysia’s trade performance was in tandem with countries in the region, notably Indonesia, Singapore, South Korea and Thailand.

Meanwhile, trade with existing Free Trade Agreement (FTA) partners in 2020 stood at RM1.185 trillion, registering a decrease of 3.7 per cent and accounted for 66.7 per cent of Malaysia’s total trade.

“The recent signing of the Regional Comprehensive Economic Partnership (RCEP), the biggest FTA in the world, will provide Malaysian companies and businesses access to more than a third of the world’s market, attract foreign direct investment and will be a boon to our export growth,” Azmin said.

Going forward, he said investor confidence has been bolstered by Moody’s latest affirmation of Malaysia’s local and foreign currency long-term issuer ratings at A3, with a stable outlook.

“This is a testament to the government’s strong fiscal discipline and robust medium-term growth prospects and demonstrates Moody’s confidence in Malaysia as having a strong credit standing.

“While these are challenging times, the government’s priority is to place the nation firmly on the path of economic recovery, particularly with the 12th Malaysia Plan as the blueprint for sustainable growth founded on sound economic fundamentals and decisive policy measures.

“This bodes well for greater and more robust trade performance.”

Source: NST