KUALA LUMPUR (May 27): Exports of the Asean-5 economies plus Vietnam have contracted year-on-year in recent months. However, the severity of the contraction in exports varied from country to country. Some, like Malaysia and Indonesia, have seen fewer months of contraction in exports, while others like Singapore, Vietnam, Thailand and the Philippines have seen exports contracting since the fourth quarter of 2022.
One of the main reasons is because the latter group of countries has a significant amount of exports tied to the electrical and electronics sector.
Malaysia’s exports are more diversified, while Indonesia is heavy on commodities. But the advantage that Indonesia and Malaysia have in commodities may be wearing off, as commodity prices are normalising.
That said, exports are likely to continue to contract in the coming months for the Asean economies until there is a turn in the electronics trade cycle, which many expect to take place in the fourth quarter.
Meanwhile, the US tariff issue has drawn attention to the Malaysian solar panel industry. Lawmakers in the US had attempted to reinstate tariffs on solar photovoltaic modules from Malaysia, Vietnam, Cambodia and Thailand, as they believe that solar panel imports from these countries are circumventing tariffs on goods made in China. How will this affect the solar panel industry in Malaysia, and what is the impact on the solar players here?
Read all about it in the May 29 issue of The Edge Malaysia weekly.
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