KUALA LUMPUR (Malaysia) - MALAYSIA'S exports shrank 15 per cent in December as flagging global demand took its toll, official data showed on Thursday.
The bigger-than-expected slowdown in exports marked the third consecutive monthly contraction. Economists said exports could plunge even further as the world economic crisis deepens.
Exports dropped to RM46.09 billion (S$19.3 billion) in December while imports decreased 23 per cent from a year earlier to RM34.4 billion, Malaysia's trade ministry said in a statement.
For all of 2008, exports grew 9.6 per cent while imports fell 3.3 per cent, resulting in a trade surplus of RM142 billion.
Economists attributed the annual exports growth to strong commodity prices in the first half of the year, but said prices have fallen since then while global demand for goods stagnated in the fourth quarter.
'It will get worse as long as the global slowdown persists,' said Mr Gundy Cahyadi, economist with research firm IDEAGlobal in Singapore.
IDEAGlobal expects Malaysia's exports to contract at a double digit rate this year. The firm recently cut its 2009 growth forecast for Malaysia to 1-1.5 per cent from 3.2 per cent, and much lower than the government's target of 3.5 per cent.
Trade Minister Muhyiddin Yassin has also predicted exports in 2009 may decline for the first time in eight years amid weaker demand from the US, Japan and Europe - Malaysia's key trading partners.
The trade ministry said exports of electrical and electronic goods, which account for 38 per cent of total shipment, fell 3.4 per cent last year. But overseas sales of palm oil soared 46 per cent, crude petroleum by 31 per cent and liquefied natural gas by 56 per cent, it said.
The government is due to unveil a second stimulus package on March 10 to prevent a recession, after saying in November it would inject RM7 billion ringgit this year to boost growth.
It will also cut electricity tariffs from March and may further liberalise non-financial services sectors to cut the costs of doing business to woo investors. -- AP
The bigger-than-expected slowdown in exports marked the third consecutive monthly contraction. Economists said exports could plunge even further as the world economic crisis deepens.
Exports dropped to RM46.09 billion (S$19.3 billion) in December while imports decreased 23 per cent from a year earlier to RM34.4 billion, Malaysia's trade ministry said in a statement.
For all of 2008, exports grew 9.6 per cent while imports fell 3.3 per cent, resulting in a trade surplus of RM142 billion.
Economists attributed the annual exports growth to strong commodity prices in the first half of the year, but said prices have fallen since then while global demand for goods stagnated in the fourth quarter.
'It will get worse as long as the global slowdown persists,' said Mr Gundy Cahyadi, economist with research firm IDEAGlobal in Singapore.
IDEAGlobal expects Malaysia's exports to contract at a double digit rate this year. The firm recently cut its 2009 growth forecast for Malaysia to 1-1.5 per cent from 3.2 per cent, and much lower than the government's target of 3.5 per cent.
Trade Minister Muhyiddin Yassin has also predicted exports in 2009 may decline for the first time in eight years amid weaker demand from the US, Japan and Europe - Malaysia's key trading partners.
The trade ministry said exports of electrical and electronic goods, which account for 38 per cent of total shipment, fell 3.4 per cent last year. But overseas sales of palm oil soared 46 per cent, crude petroleum by 31 per cent and liquefied natural gas by 56 per cent, it said.
The government is due to unveil a second stimulus package on March 10 to prevent a recession, after saying in November it would inject RM7 billion ringgit this year to boost growth.
It will also cut electricity tariffs from March and may further liberalise non-financial services sectors to cut the costs of doing business to woo investors. -- AP
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