KUALA LUMPUR, Apr 5: Malaysia’s exports fell the most in more than three years in February as the Lunar New Year holiday crimped economic activity in its Asian trading partners, but are expected to regain some ground in the months ahead.
Data from the Statistics Department on Friday showed that exports in February fell 7.7 percent on year, the biggest drop since September 2009, as shipments to China, Japan, and Singapore dropped.
Exports to the United States, which mainly involve electronics, also declined, underlining the uneven nature of demand in the world’s biggest economy.
A Reuters poll had forecast a smaller drop of 4.7 percent in February exports and a 1.6 percent rise in imports for the month.
‘The trade data came in rather disappointing, although we understand that some base effects would have played a part,’ Gundy Cahyadi, OCBC economist in Singapore, said. ‘That said, this weak data suggests that the recovery signs in January were not solid as yet.’
Friday’s data showed imports slipped 4.4 percent in February on the year, helping widen the month’s trade surplus to a healthy 8.2 billion ringgit ($2.66 billion) after January’s 3.3 billion ringgit, which was the lowest in 11 years.
Asia’s other powerhouses have all reported weaker shipments in February. Thailand’s exports fell 5.8 percent, Indonesia’s declined 4.5 percent and Singapore’s plunged 30.6 percent.
Malaysia’s exports in the January-February period, taken together, fell 2.2 percent compared to the same period last year, the data showed, reinforcing the view that February’s sharp drop was due mainly to the Lunar New Year holiday, rather than a trend.
‘We think exports growth will eventually recover into 2H 2013, albeit at a pace that is less than robust. Much willl depend on the strength of the global economy,’ Cahyadi said.
Imports grew 5.8 percent in the Jan-Feb period over the previous year, suggesting that economy activity in the trade dependent country remained strong, powered by resilient domestic demand and government spending in the run-up to elections expected this month.
Gross domestic product is expected to grow 5-6 percent this year after 2012’s 5.6 percent pace of expansion. ($1 = 3.0800 Malaysian ringgit)
(AGENCIES)
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