KUALA LUMPUR, June 4 — The Covid-19 pandemic, which has caused major disruptions to the global supply chain, has dragged Malaysia to record a trade deficit of RM3.5 billion in April 2020, after 269 consecutive months of surplus on account of higher contraction in exports compared to imports.
During the reviewed month, exports contracted by 23.8 per cent to RM64.92 billion, while imports decreased by 8.0 per cent to RM68.42 billion, said the International Trade and Industry Ministry (Miti).
Miti said total trade in April 2020 amounted to RM133.34 billion, a decrease of 16.4 per cent compared with April 2019 due to Covid-19 with lower trade recorded particularly with Singapore, Thailand, India, the United States (US), Japan, Vietnam and Saudi Arabia.
On a monthly basis, trade and exports slipped by 9.9 per cent and 19 per cent respectively compared with March 2020, while imports increased by 0.9 per cent.
Commenting on the performance, Senior Minister and the International Trade and Industry Minister Datuk Seri Mohamed Azmin Ali said that the declines in both exports and imports were expected given that most countries around the world were under some form of lockdown to contain the spread of Covid-19.
This has caused major disruptions to the manufacturing activities and movement of goods globally, he said.
Nevertheless, exports of some products such as iron and steel, rubber gloves and refined palm oil recorded increases, he added.
"Malaysia's exports are expected to improve in the coming months as the government allowed more industries to resume operations and at full operating capacity since May 4, 2020.
“Similarly, companies in other countries are also ramping up their business operations. This will boost trade activities between Malaysia and other countries", he added.
According to Miti, exports of iron and steel products, transport equipment as well as rubber products recorded double-digit growth of 21.5 per cent, 21.8 per cent and 11.7 per cent respectively, despite the decline in exports of manufactured goods by 23.4 per cent year-on-year (y-o-y) to RM55.5 billion.
The contraction of manufactured goods, which constituted 85.5 per cent of total exports, was due to lower exports of electrical and electronic products, manufactures of metal, machinery, equipment and parts, petroleum products as well as optical and scientific equipment, the Ministry said.
During April 2020, trade with Asean contracted by 27.9 per cent y-o-y to RM30.4 billion, accounting for 22.8 per cent share of Malaysia’s total trade, while trade with China which represented 19.7 per cent of Malaysia’s total trade, decreased marginally by 1.5 per cent y-o-y.
MITI said trade with the US (8.0 per cent of total trade) decreased by 19.6 per cent y-o-y to RM10.67 billion while trade with the European Union (EU) (7.1 per cent of total trade) decreased 33.3 per cent y-o-y to RM9.42 billion.
Trade with Japan (6.4 of total trade) contracted by 22.2 per cent y-o-y to RM8.59 billion while trade with Free Trade Agreement (FTA) partners (71.6 per cent of total trade) declined 9.5 per cent y-o-y to RM95.47 billion. — Bernama