Malaysia Faces Volatile Trade Amid Global Tensions
(MENAFN) Economists warned on Monday of a turbulent trade environment ahead for Malaysia due to global trade tensions.
Maybank Investment Bank stated that it expects trade figures to remain volatile as the impact of front-loading in exports fades. The outlook will depend heavily on the results of trade negotiations with the United States and decisions regarding crucial tariffs on semiconductors.
The bank also noted that Malaysia's imports are expected to follow a similar volatile pattern, particularly imports of intermediate goods, as well as capital goods imports, influenced by changes in base effects.
The research firm anticipates Malaysia’s export and import growth to slow this year to 4.3 percent and 5.8 percent, respectively, down from last year’s 5.7 percent and 13.2 percent.
In a separate analysis, Hong Leong Investment Bank highlighted that the ongoing investigation into Malaysia's electrical and electronics imports, coupled with unpredictable U.S. tariff policies, adds further uncertainty to the country's trade outlook.
MIDF Research has simultaneously warned that uncertainties in trade policy, increasing price pressures, intensifying geopolitical tensions, and the potential for reduced demand from major trading partners present considerable risks to Malaysia's trade performance.
As a result, the research firm has downgraded Malaysia's growth forecast, predicting that export growth will slow to 2 percent and import growth to 4.5 percent this year, driven by companies reducing production in anticipation of weaker demand.
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