Malaysia Exports Jump on Crude, Palm Oil Demand
Malaysian exports in May jumped 22 percent from a year earlier to a record high, far exceeding market expectations, thanks to high shipments of crude, palm oil and electronics.
The Southeast Asian country expects its exports to grow 6 percent in 2008, more than twice as fast as last year, as higher crude and palm oil prices benefit Malaysia, a net oil exporter and the second-largest palm oil producer in the world.
"It's a positive surprise. Malaysia is benefiting from the rise in global prices of commodities related to fuel, food and building materials," said Azrul Azwar Ahmad Tajudin, senior economist at Bank Islam.
Malaysia has gradually reduced its dependence on electronics orders from the United States, its main trading partner, but analysts warn that the weakness in the world's largest economy could spread to markets in China, India and Southeast Asia.
"The improvement in May electronics exports is quite a comforting sign," said Singapore-based economist Gundy Cahyadi of IDEAglobal.
However, it remains to be seen if the robust growth in the electronics segment could be sustained, said Cahyadi.
"The outlook for the electrical and electronics component is still quite shaky. Latest data from other countries such as Singapore had not been so good," he said.
May's growth in exports was the quickest since September 2004, when exports rose by 30.5 percent.
Exports totalled 60.6 billion ringgit ($18.57 billion) in May -- the highest monthly exports ever recorded -- thanks to shipments of electrical and electronic products, palm oil, crude oil and refined petroleum products, and chemicals, the trade ministry said in a statement.
A Reuters survey of economists had predicted annual export growth of 13.4 percent for the month.
Imports were 7.9 percent higher in May compared with a year earlier, below economists' expectations for a 8.8 percent rise.
The trade surplus for May stood at 15.6 billion ringgit against 7.98 billion ringgit a year ago. The Reuters poll had forecast a surplus of 10.9 billion ringgit.
The government does not release seasonally adjusted data to show the growth between months.