KUALA LUMPUR, Nov 30 — Malaysia’s trade performance for the period from January to October 2023 has been affected by the world economic situation which is not encouraging with high global inflation rates, commodity price uncertainty and a high base effect, according to the Investment, Trade, and Industry Ministry (Miti).
Although Malaysia’s export and import performances have each decreased by eight per cent for the period from January to October 2023 compared to last year, Malaysia’s global trade value has surpassed the RM2 trillion level, reaching RM2.181 trillion.
“Exports have also crossed the RM1 trillion level to RM1.186 trillion while imports are worth RM995.55 billion. Trade surplus shrank by 7.9 per cent to RM190.04 billion,” it said in a reply published on the Parliament website yesterday.
Miti was responding to Senator Datuk Shamsuddin Abd Ghaffar’s query, who asked its minister to state how Malaysia faces the situation of economic uncertainty and geopolitical turmoil globally so the trade value of exports is not affected and can even be improved.
The declining performance is in line with most of Malaysia’s major trading partners, including Taiwan, Singapore, South Korea, Indonesia, and China, where each recorded negative trade growth in the period from January to October this year.
To face the situation of economic uncertainty and the current geopolitical crisis, the government, via the Malaysian External Trade Development Corporation (Matrade), an agency under Miti, has formulated various strategies and approaches.
Those strategies and approaches include Matrade increasing exports to markets under Free Trade Agreements (FTAs) like the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), with lower tariffs imposed on Malaysian goods, including palm oil, electrical & electronic (E&E) goods, automotive products, and others.
Through a network of 46 overseas offices, Matrade plays a role in bringing quality foreign buyers to match with local companies at international trade fairs organised in Malaysia, including Oil and Gas Asia (OGA), the Malaysia International Halal Exhibition (Mihas), Defence Services Asia (DSA) and the International Greentech & Eco Products Exhibition and Conference Malaysia (IGEM).
Matrade also diversified export destinations, especially to non-traditional markets like Central Asia and Latin America, which show high potential, i.e. in the first ten months of 2023, exports to these markets recorded positive growth by 17.3 per cent and 3.9 per cent.
It implements various exporter development programmes to foster sustainability and sustainability practices among local industrialists and facilitates Malaysian companies to penetrate the international market through the Market Development Grant (MDG).
Matrade also offers the Services Export Fund (SEF), a refund grant to increase Malaysia’s service exports, including implementing project studies, international tender bidding, travel costs for meetings with potential clients abroad, and so on.
The government also implements the Overseas Trade and Investment Promotion Mission (MGPP) programme aimed at promoting Malaysia as a destination of choice for foreign direct investment (FDI) as well as goods and services produced in Malaysia to increase exports, encourage bilateral investment and trade cooperation between governments, and further contributing to the nation’s economic development.
“The initiatives that have been mentioned are among the government’s efforts to increase the value of export trade, which has decreased due to the uncertain global environment,” Miti said.