Exports Turned Around to 2.2% Yoy in March

Supported by Higher Demand for Manufactured and Mining Goods

Malaysia’s export growth turned around from -2.0% yoy in February to 2.2% in March, in line with market expectations of a 2% increase. The improvement in exports growth was supported by higher exports of manufactured goods, from 1.5% yoy in February to 3.7% in March, as well as higher exports of mining goods, from -10.2% yoy to 1.5% during the same period. On a month to month basis, export growth rebounded strongly from -15.1% mom in February to 20.1% in March, after the low base effect due to a seasonal factor (as Lunar New Year fell in February this year).

On manufactured goods, growth was driven by higher exports of electrical and electronic (E&E) products, which expanded by 8.7% yoy in March, after falling sharply to 0.1% in February. This was reflected in higher demand for thermionic valves & tubes, photocells, which accelerated further to 21.7% yoy in March (10.6% in February). This helped offset the contraction in other E&E subcomponents, include parts & accessories for office machines (-0.8%), telecommunication equipment, part & accessories (-23.3%), as well as electrical apparatus and parts (-14.4%).

In March, global semiconductor sales slowed slightly from 21% yoy in February to 19.8% in March, but continued to register double-digit growth for 16 straight months. According to the Semiconductor Industry Association (SIA), sales continued to lead by US, which grew by 35.7% yoy in March, followed by Europe (20.6%), China (17.4%) and Japan (11.1%).

Exports in other manufactured products, including demand for machinery & appliances (4.9%) and chemicals & chemical products (7.8%) remained strong in March. Nonetheless, exports of refined petroleum products and optical & scientific equipment contracted by 24.6% and 0.2% respectively.

Source: Affin Hwang Research - 7 May 2018