MIDF Amanah Maintains Malaysia's 2024 Exports Growth Forecast At 5.2 Pct, Imports At 11.2 Pct

KUALA LUMPUR, Aug 19 (Bernama) -- MIDF Amanah Investment Bank Bhd has maintained its forecast that Malaysia’s goods exports and imports will recover and grow at 5.2 per cent (2023: -8.0 per cent) and 11.2 per cent (2023: -6.4 per cent), respectively, this year.

In a research note today, the bank said that the pickup in external demand for manufactured goods exports, including electric and electronic (E&E) components, along with other commodities, such as palm oil and natural gas, will support a rebound in exports this year.

“Export growth accelerated to 12.3 per cent year-on-year (y-o-y) in July 2024, marking the fastest growth in over 1.5 years, driven by stronger domestic exports (+18 per cent y-o-y), cushioning the drag from falling re-exports (-5.8 per cent y-o-y),” it said.

The bank also noted that the trade growth in July exceeded expectations, with a jump of 18.3 per cent y-o-y, bringing the total trade value to RM255.88 billion, supported by higher shipments of palm oil and palm oil products, as well as rebounds in exports of E&E and petroleum products.

“We anticipate the export recovery to continue in the second half of 2024, driven by foreign demand for both E&E and non-E&E products.

“The external trade recovery will support our projection that Malaysia’s economy will grow stronger this year, in addition to sustained growth in domestic spending activities,” it said.

Meanwhile, MIDF Amanah pointed out that the faster growth in imports, which surged by 25.4 per cent y-o-y in July 2024 from 17.8 per cent y-o-y in June 2024, was mostly due to higher purchases of manufactured goods, particularly E&E products and machinery, equipment, and parts.

The relatively robust import growth is expected to be supported by companies increasing purchases of raw materials to meet growing demand and engaging in restocking activities to mitigate risks of supply chain disruptions, it said.

“(However), we are also concerned that the trade outlook may be constrained by the escalation in geopolitical tensions, which could adversely affect global trade flows and supply chain activities, and the risk of weaker demand from major markets, given concerns over a slower growth outlook in China and the United States,” it added.

-- BERNAMA