Trade Performance For 2018 and December 2018

TRADE PERFORMANCE 2018

Largest Trade Surplus since 2012 as Exports reached almost RM1 trillion in 2018

Supported by stronger than expected export growth, Malaysia’s total trade in 2018 remained resilient, expanding by 5.9% to RM1.876 trillion, compared with RM1.771 trillion in 2017.

Despite the uncertainties in the global environment, exports rose by 6.7% to reach a value of RM998.01 billion, surpassing the forecast export growth of 4.4% in the Economic Outlook 2019. Imports increased by 4.9% to RM877.74 billion.

Malaysia’s trade surplus widened by 22.1% to RM120.27 billion, registering the fastest rate in 10 years and the largest trade surplus since 2012. This was the 21st consecutive year of trade surplus since 1998.

This achievement was contributed by higher trade with Hong Kong SAR, which expanded by 45.2% or RM27.91 billion, China (↑8.1% or RM23.4 billion), ASEAN (↑4.7% or RM22.91 billion), Taiwan (↑22.1% or RM17.37 billion), the European Union (EU) (↑4.8% or RM8.45 billion), Saudi Arabia (↑45.2% or RM6.75 billion), Republic of Korea (ROK) (↑7.2% or RM4.89 billion), Australia (↑4.8% or RM2.52 billion), Bangladesh (↑27.3% or RM2.05 billion) and the United States (US) (↑1.1% or RM1.72 billion).

Major highlights on exports in 2018:

  • Average monthly exports was valued at RM83 billion;
  • Expansion of manufactured and mining exports by 9.1% and 7.1%, respectively, compensating for the lower performance of agriculture goods;
  • Continued growth for electrical and electronics (E&E) exports driven by wider application of semiconductors in technology advancement;
  • Double-digit year on year (y-o-y) growth for crude petroleum exports except for January and February, supported by higher crude oil prices;
  • Rising exports to ASEAN by 5% with significant growth to Viet Nam, Thailand, Singapore, the Philippines and Cambodia;
  • Increased exports to almost all major Free Trade Agreement (FTA) partners;
  • Strong export growth to advanced countries, in particular, the US and the EU notably Germany, Spain and Italy; and
  • Growing exports to emerging markets such as Bangladesh, Peru, Qatar, Sri Lanka, Papua New Guinea and countries in Africa principally, South Africa, Tunisia and Djibouti.

Trade Performance with Major Markets

ASEAN Led the Way for Export Growth

ASEAN remained as an important and strategic trading partner for Malaysia, accounting for 27.1% of Malaysia’s total trade in 2018, valued at RM509.2 billion with an increase of 4.7% from 2017.

Exports to ASEAN grew by 5% to RM285.3 billion, contributing 28.6% to Malaysia’s total exports. The expansion was supported by greater exports to Viet Nam, Thailand, Singapore, the Philippines and Cambodia that accounted for 87.1% of Malaysia’s exports to this region. Major contributors to the increase were E&E products, crude petroleum, manufactures of metal, chemicals and chemical products, transport equipment as well as iron and steel products which collectively increased by RM17.23 billion.

Singapore remained the largest export market in ASEAN with a share of 48.8% of total exports to ASEAN. Exports to Singapore increased by 2.6% to RM139.12 billion due to higher exports of E&E products and petroleum related products namely, crude petroleum and petroleum products.

Exports to Thailand rose by 12.4% to RM56.77 billion, underpinned by higher exports of manufactured goods primarily E&E products, transport equipment, petroleum products, manufactures of metal as well as chemicals and chemical products.

In 2018, Viet Nam has superseded Indonesia as the 3rd largest export destination in ASEAN. Viet Nam registered strong export growth of 24% to reach RM34.21 billion, owing mainly to higher exports of petroleum products, E&E products, manufactures of metal as well as chemicals and chemical products.This was the 4th consecutive year of double-digit export growth to Viet Nam.

Exports to Indonesia stood at RM31.75 billion, a decrease of 5.6% attributed to lower exports of petroleum products by RM3.5 billion. However, exports of iron and steel products, crude petroleum, transport equipment as well as chemicals and chemical products registered increases.

Exports to the Philippines grew by 2% to RM16.85 billion, benefitting from higher exports of crude petroleum, E&E products, chemicals and chemical products, transport equipment as well as petroleum products.

Imports from ASEAN rose by 4.3% to RM223.9 billion. Main imports were E&E products, petroleum products as well as chemicals and chemical products.

China – Malaysia’s Largest Trading Partner for 10 Successive Years

China continued to be Malaysia’s largest trading partner for 10 consecutive years since 2009. In 2018, Malaysia’s trade with China rose by 8.1% to RM313.81 billion and constituted 16.7% of Malaysia’s total trade.

Exports to China expanded by 10.3% to RM138.88 billion, on account of higher exports of chemicals and chemical products, E&E products, LNG, manufactures of metal, optical and scientific equipment, transport equipment and processed food.

China remained as Malaysia’s largest import source, accounting for 19.9% share of total imports in 2018. Imports from China increased by 6.4% to RM174.93 billion, aided by higher imports of E&E products, manufactures of metal, chemicals and chemical products as well as transport equipment.

Exports to the EU – Almost All Major Markets Recorded Increases

Trade with the EU in 2018 amounted to RM183.37 billion or 9.8% share of Malaysia’s trade, a growth of 4.8% compared to 2017. Malaysia’s exports to the EU were higher by 3.5%, reaching RM98.6 billion.

Among the top 10 EU markets which accounted for 90.7% of Malaysia’s total exports to the EU, 7 countries recorded expansion namely, Germany which increased by 5.7%, Spain (↑46.6%), Italy (↑27%), France (↑7.9%), Czech Republic (↑32.1%), Hungary (↑17.8%) and Poland (↑8.1%). Germany surpassed the Netherlands as the largest export destination in this region in 2018.

Increased exports to the EU were driven mainly by manufactured goods which accounted for 90.8% of Malaysia’s total exports to the region. Exports of this sector rose by 5.5% to RM89.53 billion buoyed mainly by manufactures of metal which increased by 148.7% or RM3.27 billion. Other drivers of exports were chemicals and chemical products, rubber products, iron and steel products, machinery, equipment and parts, transport equipment as well as petroleum products.

Imports from the EU expanded by 6.5% to RM84.77 billion and the main imports were E&E products, transport equipment as well as machinery, equipment and parts.

Exports to the US Reached the Highest Value in 11 years

Trade with the US recorded a growth of 1.1% to RM155.68 billion, constituting 8.3% of Malaysia’s total trade in 2018. Exports to the US rose by 2.3% to RM90.73 billion, registering the highest value since 2008.

The expansion was led mainly by manufactured goods which increased by 3.1% to RM87.4 billion and accounted for 96.3% of Malaysia’s total exports to the country. This was supported by higher exports of optical and scientific equipment, transport equipment, manufactures of metal, machinery, equipment and parts, rubber products as well as chemicals and chemical products that cushioned the contraction in exports of E&E products. Exports of E&E products decreased by 3.9% or RM1.9 billion, the first decline since 2014. This product accounted for 52.1% of Malaysia’s exports to the US.

Imports from the US decreased slightly by 0.5% to RM64.94 billion and the main imports were E&E products, machinery, equipment and parts as well as chemicals and chemical products.

Japan Remained the 4th Largest Trading Partner with Trade exceeding RM100 billion

Trade with Japan totalled RM132.57 billion, sustaining an annual value above RM100 billion for over a decade and remained as Malaysia’s 4th largest trading partner since 2015 despite a decline of 4.8% in 2018. Trade with Japan accounted for 7.1 % of Malaysia’s total trade.

Exports contracted by 8.6% to RM69.06 billion, on account of lower exports of LNG and E&E products which decreased by 18.4% and 11.5%, respectively. These two products contributed 56.8% to Malaysia’s total exports to Japan. Major products that registered significant increases in exports were chemicals and chemical products, iron and steel products, manufactures of metal, petroleum products, wood products, manufactures of plastics as well as rubber products.

Imports from Japan decreased slightly by 0.2% to RM63.51 billion in 2018. Major imports were E&E products, machinery, equipment and parts as well as transport equipment.

Resilient Exports to FTA Markets

In 2018, trade with FTA partners increased by 4.1% to RM1.171 trillion and accounted for 62.4% of Malaysia’s total trade. Exports to FTA partners grew by 4.4% to RM615.33 billion, representing 61.7% of Malaysia’s total exports. Imports grew by 3.8% to RM555.73 billion.

Exports to the ROK surged by 17.8% to RM33.68 billion, attributed mainly to higher exports of E&E products, Australia (↑3.2% to RM33.41 billion, crude petroleum), New Zealand (↑6% to RM4.78 billion, crude petroleum), Cambodia (↑23.7% to RM1.54 billion, petroleum products) and Chile (↑13.6% to RM811.4 million, chemicals and chemical products).

Increases in exports were also recorded to India, which grew by 5.1% to RM36.29 billion mainly due to higher exports of crude petroleum and manufactures of metal. Exports to Pakistan were up by 2.1% to RM5.15 billion, spurred by higher exports of petroleum products. These two countries accounted for 76.7% share of Malaysia’s total exports to South Asia.

Promising Emerging Markets

In 2018, other promising markets with significant growth in exports were Bangladesh, South Africa, Sri Lanka, Papua New Guinea, Peru, Qatar, Tunisia and Djibouti. Exports to Bangladesh increased by 29.5% to RM8.48 billion, South Africa (↑13.2% to RM3.77 billion), Sri Lanka (↑16.4% to RM2.89 billion), Papua New Guinea (↑27.8% to RM1.85 billion), led by higher exports of petroleum products.

Other markets registered expansion in exports were Peru which grew by 50% to RM757.7 million due mainly to palm oil-based manufactured products, Qatar (↑29.8% to RM989.6 million, machinery, equipment and parts), Tunisia (↑108.4% to RM418.6 million, E&E products) and Djibouti (↑33.2% to RM826.1 million, palm oil and palm oil-based agriculture products).

Performance of Major Sectors

Manufactured and Mining Goods Propelled Export Growth

In 2018, exports of manufactured goods grew by 9.1% or RM69.62 billion to RM835.48 billion. Manufactured exports accounted for a larger share of total exports at 83.7% compared to 81.9% in 2017.

E&E products held the biggest share of Malaysia’s exports composition in 2018, at 38.2% or RM380.81 billion, rising by 11% or RM37.74 billion. Increase in exports of E&E products over RM1 billion were registered for, among others:

  • Electronic integrated circuits, increased by RM44.47 billion to RM172.63 billion;
  • Batteries and electric accumulators, ↑RM2.24 billion to RM4.59 billion;
  • Microphones, loudspeakers, headphones, earphones, amplifier sets, and parts,↑RM2 billion to RM6.45 billion;
  • Other units of computers and data processing equipment, ↑RM1.42 billion to RM16.52 billion; and
  • Computers, ↑RM1.1 billion to RM6.9 billion.

Markets which registered significant increase in exports of E&E products were Hong Kong SAR, Taiwan, China, Thailand, the ROK, Singapore and Viet Nam.

Other manufactured products that contributed to the growth in exports for 2018 were:

  • Chemicals and chemical products, ↑22.5% to RM57.72 billion;
  • Manufactures of metal, ↑17.8% to RM44.67 billion;
  • Petroleum products, ↑6.4% to RM76.39 billion;
  • Optical and scientific equipment, ↑12.1% to RM36.33 billion;
  • Transport equipment, ↑15.5% to RM18.02 billion;
  • Iron and steel products, ↑19.1% to RM14.97 billion;
  • Non-metallic mineral products, ↑21% to RM7.26 billion;
  • Machinery, equipment and parts, ↑1.2% to RM40.63 billion;
  • Paper and pulp products, ↑5.6% to RM4.95 billion;
  • Rubber products, ↑0.4% to RM26.41 billion; and
  • Manufactures of plastics, ↑0.2% to RM14.53 billion.

Mining Goods

Exports of mining goods rose by 7.1% to RM87.62 billion. This sector made up 8.8% share of total exports in 2018. Exports of crude petroleum increased by 29.4% to RM36.57 billion due to higher Average Unit Value (AUV) and volume. However, exports of LNG contracted by 3.1% to RM40.14 billion.

Agriculture Goods

Agriculture goods contracted by 14.2% to RM67.01 billion, accounted for 6.7% of total exports in 2018. Exports of palm oil and palm oil-based agriculture products declined by 17.3% to RM44.7 billion, mainly due to lower exports of palm oil on account of lower AUV in tandem with lower global prices despite higher export volume.

Intermediate and Capital Goods Accounted for 65.2% of Imports

In 2018, Malaysia’s total imports increased by 4.9% to RM877.74 billion. The three main categories of imports by end use which accounted for 73.5% of total imports in 2018 were:

  • Intermediate goods valued at RM460.32 billion or 52.4% of total imports, decreased by 3.9% from 2017, following lower imports of parts and accessories of capital goods (except transport equipment), particularly electrical machinery, equipment and parts;
  • Capital goods (RM111.81 billion or 12.7% of total imports), ↓3.2%, due mainly to lower imports of capital goods (except transport equipment), particularly parts of machinery and mechanical appliances; and
  • Consumption goods (RM72.78 billion or 8.3% of total imports), ↑2.5%, as a result of higher imports of non-durables mainly for pharmaceutical products.

Imports of manufactured goods, accounted for 87% of Malaysia’s total imports. Major imports of manufactured goods in 2018 were:

  • E&E products, valued at RM261.65 billion, accounted for 29.8% share of Malaysia’s total imports, increased by 3.4% from 2017;
  • Petroleum products, RM86.2 billion, 9.8% share, ↑14.4%;
  • Chemicals and chemical products, RM82.73 billion, 9.4% share, ↑11%;
  • Machinery, equipment and parts, RM73.62 billion, 8.4% share, ↓6.3%; and
  • Manufactures of metal, RM46.11 billion, 5.3% share, ↑5.6%.

China remained the largest import source since 2011, followed by Singapore, the US, Taiwan and Japan. These countries represented 53.4% of total imports. Imports from ASEAN amounted to RM223.9 billion or 25.5% share of Malaysia’s total imports while the EU accounted for 9.7% share, with a value of RM84.77 billion.

TRADE PERFORMANCE FOR FOURTH QUARTER 2018

Q4 2018 - Trade Rose 6.9% Backed by Strong Exports

Total trade for the fourth quarter (Q4) of 2018 expanded by 6.9% to RM494.41 billion compared with Q4 2017. Exports increased by 8% to RM264.5 billion and imports rose 5.7% to RM229.91 billion. This resulted in a trade surplus of RM34.58 billion.

Compared to the third quarter (Q3) 2018, trade, exports and imports increased by 3.7%, 5.4% and 1.8%, respectively.

TRADE PERFORMANCE FOR DECEMBER 2018

December Exports Up by 4.8% y-o-y to RM83.27 billion

Malaysia’s total trade in December 2018 recorded a growth of 3% to RM156.12 billion compared with a year ago. Significant increases in trade were recorded with ASEAN, the US, Hong Kong SAR, Taiwan, China, Australia, India, Pakistan and the ROK.

A higher trade surplus of RM10.43 billion was registered in December, making it the 254th consecutive month of trade surplus since November 1997. Exports expanded by 4.8% y-o-y to RM83.27 billion. Manufactured goods accounted for 83.6% of total exports, mining goods, 9.9% and agriculture goods, 5.7%. Major export products were:

  • E&E products valued at RM32.81 billion, with a share of 39.4% of total exports, increased by 14.2% from December 2017;
  • Chemicals and chemical products (RM5.35 billion, 6.4%, ↑36.6%);
  • Petroleum products (RM5 billion, 6%, ↓18.4%);
  • LNG (RM4.12 billion, 4.9%, ↓2.7%); and
  • Machinery, equipment and parts (RM3.37 billion, 4.1%, ↑7.6%).

Imports in December 2018 increased by 1% to RM72.84 billion compared with December 2017. Imports rose on the back of higher uptake of intermediate and consumption goods. The three main categories of imports by end use were:

  • Intermediate goods valued at RM39.55 billion or 54.3% of total imports, increased by 3.1%;
  • Capital goods (RM9.46 billion or 13% of total imports, ↓21.7%); and
  • Consumption goods (RM6.58 billion or 9% of total imports, ↑5.7%).

Major import products were:

  • E&E products, RM21.95 billion or 30.1% of total imports, increased by 2.4%;
  • Chemicals and chemical products (RM6.94 billion or 9.5% of total imports, ↑12.1%); and
  • Petroleum products (RM6.3 billion or 8.6% of total imports, ↑9.7%);

On a month-on-month (m-o-m) basis, total trade, exports and imports were lower by 3.6%, 1.9% and 5.4%, respectively.

 

Note:

It should be noted that, conceptually, the export and import figures in the external trade statistics are different from that in the goods account of the balance of payments compilation. The compilation of international merchandise trade statistics is usually based on customs records, which essentially reflect the physical movement of goods across borders, and follow international guidelines on concepts and definitions i.e. International Merchandise Trade Statistics: Concepts and Definitions 2010 (IMTS 2010) which is different from the principles of the System of National Accounts (SNA) and the Balance of Payments Compilation. Goods are defined in the SNA as “physical objects for which a demand exists, over which ownership rights can be established and whose ownership can be transferred from one institutional unit to another by engaging in transactions on markets”.

“This is a preliminary release, full details would be published in the “MONTHLY EXTERNAL TRADE STATISTICS” report by the Department of Statistics, Malaysia, to be disseminated at 1700 hours, Wednesday, 30th January 2019 and can be downloaded through statistic at the Department of Statistics, Malaysia‘s portal (https://estatistik.dosm.gov.my).”

+ This media release can be accessed through the portal of Malaysian External Trade Statistics, Ministry of International Trade and Industry (http://www.miti.gov.my) and Malaysia External Trade Development Corporation (http://www.matrade.gov.my).

# The December 2018 data is provisional and subject to revision in later issue.

With effect from reference month April 2018, selection of codes for exports and imports of palm oil and palm oil-based products has been reviewed and revised for better representation of the product and this has resulted in some changes to the data.

Updated by Corporate Communication Unit

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