• Exports slipped 2.9% yoy; Imports contracted 6.5% yoy in August
   
• Total trade decreased 4.6% yoy

• Trade surplus in August registered a double-digit growth of 19.7% yoy to RM13.3bn and exceeded RM10bn for the seventh time this year

• August exports dropped led by exports of mining and agriculture goods

• Imports contracted as intermediate and capital goods purchases decreased

• Exports to ASEAN dampened but exports to China and the US remain solid

• Global exports continue to recover in August

• Resumption of activities globally could support Malaysia exports

Exports unexpectedly dropped 2.9% yoy to RM79.1bn in 2020, after a 3.1% yoy rise in the prior month, defying consensus of rise. It was the first decline in exports in three months, amid the coronavirus crisis. The main products which contributed to the decrease in exports were liquefied natural gas, manufacture of metal, chemical and chemical products, and petroleum products. Re-exports was valued at RM14.6bn registering an increase of 8.5% yoy (Jul: +15.6%) and accounted for 18.4% of total exports. Meanwhile, domestic exports decreased by 5.2% (Jul: -0.1%) to RM64.6bn. Imports contracted 6.5% yoy to RM65.9bn as intermediate and capital goods purchases decreased. This has resulted in a trade surplus of RM13.2bn in August, a growth of 19.7% yoy and exceeding RM10bn for the seventh time in year 2020. Total trade was valued at RM145.1bn, lower by 4.6% yoy.

On a month-on-month basis, total trade, exports, and imports contracted by 9.3%, 14.5% and 2.2%, respectively. Trade surplus dipped by 47.5% mom.

For the first eight months of 2020, exports amounted RM620.6bn, decreased by 5.8% compared to the same period of 2019. Meanwhile imports declined by 7.3% to RM517.7bn. Total trade stood at RM1.1tn, also declining by 6.5%. In contrast, trade surplus recorded an increase of 2.9% to RM103.0bn.

Source: BIMB Securities Research - 29 Sept 2020