Malaysia's February exports rise at fastest pace since 2010, helped by low base

Shipping containers are stacked at North Point in Port Klang, Selangor.
Shipping containers are stacked at North Point in Port Klang, Selangor.PHOTO: BLOOMBERG

KUALA LUMPUR (REUTERS) - Malaysia's exports and imports surged in February at the fastest annual pace for a month in nearly seven years, but the strong numbers stemmed mainly from a low base and are unlikely to be sustained.

Exports rose 26.5 per cent from a year earlier, data from the International Trade and Industry Ministry showed on Wednesday (April 05). That was the fastest growth since May 2010 and the fourth straight month of expansion.

Economists had forecast 17.6 per cent. In January, exports grew 13.6 per cent.

Imports in February rose 27.7 per cent from a year earlier, the biggest annual gain since June 2010.

Economists said the high figures were rooted in a low base, stemming from the timing of the Lunar New Year, which last year was in February. This year, festivities began in late January.

"We don't expect this to sustain at current levels, and we can expect to see an unfavourable base effect emerge in March,"said Brian Tan, an analyst with Nomura in Singapore.

While the February export spike likely won't be repeated, Malaysia's trade - which it reports in ringgit - is off to a good start in 2017.

For January-February combined, exports were up 19.8 per cent from a year earlier and imports by 21.5 per cent.

Weiwen Ng of ANZ said that on a seasonally-adjusted basis, February exports were 12 per cent higher than in January.

He said drivers of February's exports included strong demand for electrical and electronic products as well as higher prices for liquefied natural gas.

February exports of manufactured goods rose 24.3 per cent and accounted for 80 percent of Malaysia's total.

Exports of mining goods increased 21.6 per cent, on higher prices of crude oil and liquefied natural gas, the data showed.

February exports to China, Malaysia's second-largest trading partner, nearly doubled at 47.6 per cent from a year earlier on higher shipments of manufactured goods and commodities.

Exports to the United States went up 13.2 per cent on stronger demand for manufactured goods, while shipments to the European Union grew 26.6 per cent.

The trade surplus in February widened to RM8.71 billion (S$2.75 billion) from January's RM4.7 billion.