Trade surplus in August 2024 narrowed to RM5.7b, its lowest level since April 2020. Year-on-year, the trade surplus was down by 67% from RM17.3b in August 2023.
Export growth eased slightly in August but still beat expectations. Despite positive momentum, downside risks to export growth can be felt from potential US economic slowdown and a weaker-than-expected recovery in China.
During the month, exports rose 12.1% (consensus expectations 11.8%) or RM115.2b to RM129.2b whereas imports increased 26.2% (consensus 21.2%) or RM97.9b to RM123.5b, according to the Department of Statistics.
The surge in imports marks a a 22-month high, led by imports of intermediate goods (about 40%), followed by capital goods (>30%) and consumption goods (>20%).
External trade in August saw higher exports to the US and strong demand in Electrical & Electronic (E&E) manufacturing sector.
Destination-wise, the US market led the way by contributing a sizeable chunk to the overall growth. Notably, rebound was seen in exports to China, reportedly up from the negative territory in July. However, export to Singapore and the EU slowed.
Sector-wise, the export growth was primarily led by expansion in E&E manufacturing, supported by machinery, equipment, and parts. Nevertheless, the momentum was partially weighed down by decline in agriculture and mining exports.
Analysts maintain the 2024 full-year export growth forecast of 7.3%.
