Total exports to grow by 2-3% in 2014

Total exports to grow by 2-3% in 2014
Posted on 19 December 2013 - 05:38am
Liew Jia Teng
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KUALA LUMPUR (Dec 19, 2013): Exports out of Malaysia is expected to reach RM723 billion in 2014, on the back of 2% to 3% growth next year, driven by fast growing business sectors such as oil and gas, electrical and electronics and the telecommunication industry, said Malaysia External Trade Development Corporation (Matrade) CEO Datuk Dr Wong Lai Sum (pix).

Exports are estimated to grow between 1% and 2% this year.

Wong told a press conference after announcing Matrade's trade promotion activities for 2014 here yesterday, other business sectors that will provide "good growth" for the export market include medical devices, machinery, manufacture of metal, industrial chemical, petrol chemical and oleo chemical, she added.

She said Malaysia will continue to strengthen its export markets in China and the Asean region, and also renew its export interest in Iraq, Brazil, Chile, Mexico, Uganda, Nigeria, Tanzania and Kazakhstan.

On the exchange rate fluctuation due to the tapering of quantitative easing (QE) Wong said, while it is bound to have an impact on exports and overall trade performance it could be mitigated by currency hedging. She said Malaysian exporters have become savvy at using currency hedging to their advantage, not the case some 10 years ago.

Malaysia's total trade for January to October 2013 increased by 3.4% to RM1.132 trillion, up from RM1.095 trillion in the same period for 2012.

This was against the backdrop of 0.9% export growth to RM591.83 billion, as well as 6.3% growth in imports to RM540.38 billion.

"Export growth in the first ten months of this year was not negative. The first half of the year was a nightmare but we have performed much better in the second half of the year," said Wong.

In 2012, total export value grew by 0.7% to RM702 billion, while total import value reached RM607 billion, bringing total trade to RM1.31 trillion.

Despite imports growing faster than exports at the moment, she said Malaysia will continue to register trade surplus "for the time being".

"We don't hope to see a trade balance. We want the export (value) to be higher than the import, and we would like to see an export growth that will bring value to the country in terms of job creation and contribute to the economy" she said.

Wong, however, acknowledged that the purpose of the import activities is also important.

"We need to look at whether or not these imports are due to investments in the country which will lead to further exports or higher efficiency that will contribute towards exports," she explained.

On another note, Wong said Matrade has planned 148 trade promotion activities in 46 countries next year. They are expected to involve 1500 to 2000 companies, in a bid to help the local manufacturers and service providers, especially small and medium enterprises (SMEs), to expand further into the international markets.

"The private sector, SMEs in particular, are always on the lookout for new opportunities and they are as gung-ho as we are," she said.