MALAYSIA continued to record steady growth momentum, backed by a robust external position of 28.2% growth in the first half of 2022 (1H 2022), according to official data.
In its latest economic statistics review for May and June, the Statistics Department (DoSM) said Malaysia’s overall economic performance is still intact, as seen in the positive trajectory registered by several key economic indicators in May, compared to last year.
Trade
Chief statistician Datuk Seri Dr Mohd Uzir Mahidin said Malaysia’s transition to the endemic phase and “fruitful” economic recovery actions by the Government influenced the performance of Malaysia’s total trade in May.
“Total trade rose by 33.6% to RM228.4 bil from RM170.9 bil in May 2021. Exports increased by 30.5% to RM120.5 bil while imports grew by 37.3% to RM107.9 bil,” Mohd Uzir’s office said in a statement today.
“As the growth of imports exceeded exports, the trade surplus fell by 8.3% to RM12.6 bil over the same period last year.
“The country’s total trade performance continued its growth momentum in June, with a value of RM270.4 bil, and subsequently recorded a growth of 43.4% from RM188.5 bil in the same period of the preceding year.”
Industry and manufacturing
The Industrial Production Index (IPI) rose moderately at 4.1% in May as compared to the same month last year, with the rise backed by increments in the Manufacturing Index (6.9%) and Electricity Index (2.8%).
The Mining Index, on the other hand, fell by 4.9%.
Meanwhile, sales in the manufacturing sector continued on a double-digit year-on-year (yoy) growth of 15.7%, recording RM142.0 bil in May. April recorded a 13.2% growth.
This trend was attributed to an increase in sales of electrical and electronics products (24.9%), food, beverages and tobacco products (20.4%) and petroleum, chemical, rubber and plastic products (7.7%).
The sector is also expected to maintain its growth momentum in the upcoming months.
Wholesale and retail trade
On the other hand, wholesale and retail trade sales soared by 19.9% yoy to a record RM129.8 bil in May, after the “full-blast” Aidilfitri celebrations this year, which had been muted since 2020 due to the COVID-19 pandemic.
Growth was driven by the retail trade sub-sector, which increased by RM13.0 bil or 29.9% to RM56.3 bil, followed by wholesale trade and motor vehicles, which surged by 11.7% to RM59.6 bil and 20.1% to RM13.9 bil, respectively.
Labour
Meanwhile, the labour force remained resilient as the number of employed persons grew by 3.4% (+529.2 thousand persons) to 15.9 mil (May 2021: 15.37 mil).
As a result, the employment-to-population ratio improved by 1.4 percentage points yoy to 66.8%.
However, the unemployment rate slipped by 0.6 percentage points yoy to 3.9%. In May 2021, it was 4.5%.
Food prices
Looking at price indices, more costly food prices accelerated Malaysia’s inflation in May, which increased 2.8% to 126.6 (against 123.1 in the same month of the preceding year).
The incline in headline inflation was mainly due to the rise in food and non-alcoholic beverages (5.2%). The same month of the preceding year posted the highest increase since November 2011.
The main causes for this increment were the rise in chicken and vegetable prices, attributed to higher prices of animal food and fertiliser as well as the high demand for these items during the festive season in May.
Inflation and PPI
Inflation for June increased 3.4% compared to the previous year, while Malaysia’s Producer Price Index (PPI) remained in double digits at a rate of 11.2% yoy in May, as compared to 11.0% in April.
The PPI growth was mainly led by the rise in the index of mining (20.6%), agriculture, forestry and fishing (16.7%) and manufacturing (10.1%).
The indices of water supply, on the other hand, increased by 1.2%, while electricity and gas supply decreased by 0.6%.
Despite this, the PPI eased to 10.9% for June as compared to 11.2% recorded in May.
The Leading Index in May grew by 2.2% to 111.2 points after recording a negative 0.5% in April, showing an improved and favourable performance in Malaysia’s economy.
As such, Mohd Uzir said Malaysia’s economic recovery will continue to be resilient for the rest of the year, provided the Government effectively manages inflation. – July 28, 2022
