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PRESS RELEASE MALAYSIAS TRADE PERFORMANCE IN 2010 The Minister of International Trade and Industry (MITI), YB Dato Sri Mustapa Mohamed announced that after a 16.5% decline in total trade registered in 2009, Malaysias trade rebounded in 2010 by registering 18.3% growth. The impressive growth was attributed to the global economic recovery which boosted demand for both manufactured goods and commodities. Total trade in 2010 breached the RM1 trillion mark to register a value of RM1.169 trillion, almost reaching the pre-crisis level of RM1.183 trillion registered in 2008. Exports expanded by 15.6% to RM639.43 billion while imports grew by 21.7% to RM529.19 billion with a trade surplus of RM110.23 billion. The growth in exports was supported by MITI and its agencies through extensive promotion and outreach programmes which aimed at encouraging the private sector to take advantage of the opportunities presented by the recovery of the global economy. The programmes and activities introduced included capacity building programmes, certification and compliance to standards, adoption of best practices, export promotion and utilisation of preferential schemes. The utilisation of preferential schemes under the FTAs also contributed to the growth in Malaysias exports. To ensure Malaysian companies benefited from the global economic recovery in 2010, MATRADE as the national trade promotion agency undertook over 200 programmes in the areas of Exporters Development and Export Promotion. Participation in overseas promotion activities focused on retaining share in traditional markets, expanding into the fast growing markets of the BRIC countries, as well as diversifying into emerging markets of West Asia, Central Asia and Africa. Focus was also given to international brand building efforts to differentiate Malaysian products and services in highly competitive markets through 3 major branding exercises, which were participation in I-Saloni, a leading furniture trade fair in Italy, Malaysia International Halal Showcase (MIHAS) for the promotion of Halal industry and Malaysia Services Exhibition (MSE) for the branding of services sector.

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EXPORT PERFORMANCE 2010 Malaysias exports to almost all markets recorded positive growth. Significant increases in exports were seen to Egypt (58.1%), New Zealand (57.4%), Philippines (43.7%), Bangladesh (43.2%), South Africa (40.7%), Taiwan (39.9%), Vietnam (39.7%), India (23.3%) and Japan (21.8%). This was contributed by higher exports of electrical and electronic (E&E) products, chemicals and chemical products, manufactures of metal, crude petroleum, palm oil, processed food, as well as refined petroleum products. Singapore, the Peoples Republic of China (PRC), Japan, the United States of America (USA) and Thailand remained the top five export destinations in 2010. Among these markets, exports to Japan valued at RM66.29 billion, registering the highest growth of 21.8%. The main increases in exports to Japan were contributed by E&E products as well as refined and crude petroleum. In terms of value, exports to the PRC registered the largest increase of RM13.35 billion to RM80.60 billion or growth of 19.9%. This was largely contributed by exports of E&E products and palm oil. ASEAN continued to remain a major regional export destination with exports valued at RM162.45 billion, accounting for 25.4% of Malaysias total exports. Exports to all countries in ASEAN recorded growth except Brunei, which declined by 7.3%. COMPOSITION OF EXPORTS In terms of export composition, manufactured goods accounted for the largest proportion with a share of 72.1%, while mining and agriculture accounted for 15.9% and 11.2% of exports respectively. Fuelled by the strong demand for E&E products, chemical and chemical products, optical and scientific equipment, manufactures of metal and rubber products, manufactured goods contributed 57.5% to the exports growth of 15.6% registered in 2010. Main contributor to increase in exports of manufactured goods was the E&E products, with exports of RM249.8 billion or 39.1% of total exports, a slight reduction compared to 41.2% in 2009. E&E products that accounted for the increase in exports were parts & accessories for ADP machines, data processing equipment, storage units for ADP machines, television reception apparatus, photosensitive semi conductor devices, electrical
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machinery and apparatus, switching apparatus, transistors, diodes, electric control panels and parts. Major export destinations for E&E products that contributed to the increase in exports were the PRC, Japan, Singapore, the UAE, the USA, Thailand, India, France and Vietnam. Exports of chemicals & chemical products registered an impressive growth of 23.8% to RM40.82 billion, contributing 6.4% to total exports. The PRC, Indonesia and Japan were the main export markets for the main products of alcohols, phenols and their derivatives, plastics in primary form and chemical elements and compounds for electronics. Exports of rubber products increased by 28.4% to RM16.03 billion, while exports of wood products increased marginally by 4.8% to RM14.83 billion in 2010. Emerging product sector with strong export growth in 2010 was optical & scientific equipment, which increased by 40.0% with a share of 2.9% of exports from 2.4% in 2009. Measuring and controlling instruments and apparatus was the main products that contributed to the increase in exports. Main export destinations were the USA, the PRC, Taiwan and Singapore. Products which registered declines in exports were iron and steel products, by 4.1%, transport equipment by 8.3% and non-metallic mineral products by 4.9%. The high average unit value and growing demand for commodities boosted the exports, namely for palm oil, liquified natural gas (LNG), refined and crude petroleum as well as crude rubber, which collectively contributed 42.7% to the growth of exports of 15.6% in 2010. The commodities which recorded impressive export growth were palm oil which increased by 25.9% to RM48.42 billion LNG by 22.1% to RM38.10 billion, crude petroleum by 21.3% to RM31.03 billion, crude rubber which surged by 106.5% to RM9.21 billion.

UTILISATION OF FREE TRADE AGREEMENTS (FTAs) FTAs negotiated bilaterally, and at the ASEAN level further enhanced market access for Malaysias products.

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Apart from ASEAN, Malaysia has concluded bilateral Free Trade Agreements with Japan, Pakistan, New Zealand, Chile and India; with ASEAN, Malaysia has concluded agreements with the PRC, the Republic of Korea (ROK), as well as Australia and New Zealand, and the FTA in goods with Japan and India. For 2010, there was an increase of 35.8% in the utilisation of Preferential Certificate of Origin based on the 509,897 Certificate of Origins issued compared with 375,589 issued in 2009. Exports performance under FTAs and GSP, recorded an increase of 37.9% in the FOB value of exports to RM103.83 billion compared with RM75.30 billion in 2009.

MOVING FORWARD Focusing on the 10th Malaysia Plan (10th MP) and National Key Economic Areas (NKEAs), trade promotion programmes for 2011 will be intensified to generate greater export growth. Under the 10th MP, exports are projected to grow at 10.6% per annum and gross exports to nearly double to RM2.190 trillion in 2015. In the global macroeconomic projections, global economy is expected to grow at a slower pace of 4.2% in 2011 while the PRC and India are viewed as new emerging economic super powers. With a global economic growth projection of 4.5% per annum for the period 2011 to 2015, emerging and developing economies are expected to grow by 6.6% per annum, while advanced economies are expected to grow by 2.4% per annum. MITI through MATRADE has realigned its export promotion strategies and programmes for 2011 by promoting high value exports, intensifying the promotion of services, enhancing capacity building programmes, utilising innovative and creative approaches in promoting Malaysias exports, as well as, increasing engagements with the local and international business communities. In 2011, a total of 113 trade promotion activities will be carried out, comprising Promotion Booths, Trade Fairs, Specialised Marketing Missions, Joint Promotion Activities, Global Supply Chain and Outsourcing Initiatives. Four special projects will be continued in 2011 namely, MSE 2011, INTRADE 2011, MIHAS 2011 and Malaysia Kitchen Programme. New innovative and green products and services will be given emphasise in export promotion programmes.

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The openness and deep integration with the global supply chain is the foundation of Malaysias economic strength. It is vital to integrate Malaysian vendors into the global supply chain through specially designed programmes, Marketing Mission abroad, targeting international procurement offices and trading establishments. Targeted sectors are exporters of intermediate and capital goods in the E&E, oil & gas, automotive and medical devices sectors. Promotion activities proposed under MATRADEs Work Programme 2011 will explore opportunities for outsourcing services which include Pure Engineering Services, Business and Professionals, ICT, E&E and Logistics services. Several programmes are planned to capitalise on these opportunities including Specialised Marketing Missions, Business Meetings and Speaking engagements. Details of the trade performance for the month of December 2010 and the year of 2010 are attached in Annex1.

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ANNEX 1
MALAYSIA EXTERNAL TRADE STATISTICS PRELIMINARY RELEASE *

TRADE PERFORMANCE FOR THE MONTH OF DECEMBER 2010 AND THE YEAR OF 2010#

Malaysias total exports in December 2010 increased by 4.6% to RM57.16 billion compared with December 2009. This was the highest exports value ever recorded for the month of December. Imports expanded by 11.5% to RM47.48 billion, resulting in a total trade of RM104.64 billion, an increase of 7.6% from the corresponding month in 2009. A trade surplus of RM9.69 billion was registered, making it the 158th consecutive month of trade surplus since November 1997.

Compared with November 2010, exports in December 2010 increased by 8.5% while imports expanded by 8.6% and total trade was 8.6% higher.

Total trade in 2010 was valued at RM1.169 trillion, an increase of 18.3% from RM988.24 billion in 2009 and 1.2% lower compared with RM1.183 trillion registered in 2008, the highest total trade ever recorded by the country. This was contributed by exports of RM639.43 billion and RM529.19 billion of imports. Exports expanded by 15.6% while imports rose 21.7% compared with 2009, resulting in a trade surplus of RM110.23 billion.

Total trade in the fourth quarter of 2010 was RM304.15 billion, an increase of 3.0% compared with the third quarter of 2010. Exports expanded by 3.8% to RM164.84 billion, while imports grew by 2.1% to RM139.30 billion.

Compared with the fourth quarter of 2009, exports and imports in the fourth quarter of 2010 were higher by 3.7% and 10.1% respectively. Total trade increased by 6.5% compared with the same quarter last year. EXPORTS IN DECEMBER 2010

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The increase in exports in December 2010 of RM2.49 billion from a year ago was largely contributed by higher exports of palm oil, refined petroleum products, chemicals and chemical products, manufactures of metal, crude rubber, iron and steel products as well as optical and scientific equipment. On a month-on-month basis, exports expanded by 8.5% attributed mainly to higher exports of electrical and electronic (E&E) products, refined petroleum products, chemicals and chemical products, machinery, appliances and parts as well as iron and steel products.

The performance of major export products is shown in Chart 1, while Chart 2 shows the performance of the top five major export destinations in December 2010.

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Exports to ASEAN was valued at RM15.03 billion, accounting for 26.3% of Malaysias total exports in December 2010. Total exports to this region increased by 5.7% compared with RM14.22 billion registered a year ago due to higher exports of refined petroleum products, palm oil, manufactures of metal and jewellery. Exports to ASEAN: Singapore Thailand Indonesia Viet Nam Philippines Brunei Darussalam Myanmar Cambodia Lao PDR RM 7.90 billion RM 3.02 billion RM 1.60 billion RM 1.23 billion RM 1.01 billion RM 134.3 million RM 74.3 million RM 59.0 million RM 3.0 million

Exports to the Peoples Republic of China (PRC) decreased by 5.7% to RM6.91 billion compared with RM7.33 billion in December 2009. This was mainly due to lower exports of E&E products and palm oil.

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Exports to Japan expanded by 11.7% to RM6.23 billion compared with RM5.57 billion in December 2009, attributed mainly to higher exports of E&E products, refined petroleum products and crude petroleum.

Exports to the European Union (EU) was valued at RM6.03 billion, 1.3% lower compared with RM6.11 billion in December 2009. This was due to lower exports of E&E products, palm oil, wood products, manufactures of metal and transport equipment. Exports to major EU countries: Netherlands Germany United Kingdom France Italy Belgium Spain Sweden Finland Poland RM 1.66 billion RM 1.66 billion RM 645.1 million RM 610.6 million RM 364.1 million RM 197.6 million RM 164.0 million RM 105.6 million RM 91.4 million RM 70.4 million

Exports to the United States of America (USA) was valued at RM5.21 billion, a decline of 4.6% from RM5.46 billion registered a year ago, mainly due to lower exports of E&E products.

Exports to Hong Kong SAR registered a marginal decline of 0.2% to RM2.83 billion from RM2.84 billion, mainly due to lower exports of E&E products.

Exports to India, the ROK and Taiwan registered positive growths of 31.7% to RM2.24 billion, 4.7% to RM2.15 billion and 18.2% to RM1.79 billion, respectively. Meanwhile the Netherlands registered a decline of 18.8% to RM1.66 billion from RM2.05 billion in December 2009.

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IMPORTS IN DECEMBER 2010

Total imports in December 2010 increased by 11.5% to RM47.48 billion from RM42.58 billion in December 2009, due mainly to higher imports of intermediate and capital goods.

The three main categories of imports by end use:

Intermediate goods valued at RM31.77 billion or 66.9% of total imports; Capital goods (RM7.36 billion or 15.5% of total imports); and Consumption goods (RM3.32 billion or 7.0% of total imports).

The performance of major import products is shown in Chart 3.

Top ten import sources: Import value (RM billion)

Share of total imports (%) 14.0 12.4 10.7 10.1 6.1 5.7 4.9 4.3 3.9 2.4

Japan PRC USA Singapore Thailand Indonesia Republic of Korea (ROK) Taiwan Germany Saudi Arabia

6.66 5.88 5.07 4.82 2.89 2.72 2.32 2.06 1.87 1.15 5

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Total imports from ASEAN amounted to RM12.01 billion or 25.3% of Malaysias total imports in December 2010.

TRADE DURING THE YEAR OF 2010 EXPORTS Total exports increased by 15.6% to RM639.43 billion in 2010, compared with RM553.30 billion in 2009. Major markets that registered significant increases in exports were Egypt (58.1%), New Zealand (57.4%), Philippines (43.7%), Bangladesh (43.2%), South Africa (40.7%), Taiwan (39.9%), Viet Nam (39.7%), India (23.3%) and Japan (21.8%). The increase in exports to Egypt, Bangladesh and South Africa was mainly contributed by higher exports of palm oil.

Top ten export destinations: Export value (RM billion)

Share of total exports (%) 13.4 12.6 10.4 9.5 5.3 5.1 3.8 3.8 3.3 3.2

Singapore PRC Japan USA Thailand Hong Kong SAR ROK Australia India Netherlands

85.43 80.60 66.29 60.96 34.19 32.54 24.20 24.02 20.96 20.22

Total exports to ASEAN increased by 14.1% to RM162.45 billion from RM142.34 billion in 2009 or 25.4% of Malaysias total exports in 2010. Total exports to the PRC increased by 19.9% to RM80.60 billion from RM67.24 billion in 2009 or 12.6% of Malaysias total exports in 2010, contributed mainly by higher exports of E&E products. E&E products accounted for 50.8% of total exports to the PRC. The export performance of major products during the period is shown in Chart 4.

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IMPORTS

Total imports increased by 21.7% to RM529.19 billion in 2010 compared with RM434.94 billion in 2009.

The three main categories of imports by end use:

Intermediate goods valued at RM363.15 billion or 68.6% of total imports, an increase of 22.1% from the corresponding period in 2009;

Capital goods (RM76.44 billion or 14.4% of total imports), an increase of 16.2%; and

Consumption goods (RM34.59 billion or 6.5% of total imports), an increase of 10.1%.

The import performance of major products during the period is shown in Chart 5.

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Top ten import sources: Import value (RM billion)

Share of total imports (%) 12.6 12.6 11.4 10.7 6.2 5.6 5.4 4.5 4.0 2.4

Japan PRC Singapore USA Thailand Indonesia ROK Taiwan Germany Hong Kong SAR

66.55 66.43 60.44 56.36 32.98 29.40 28.69 23.83 21.34 12.68

Total imports from ASEAN increased by 31.0% to RM143.48 billion, accounting for 27.1% of Malaysias total imports in 2010.

Note: It should be noted that, conceptually, the export and import figures in the external trade statistics are different from that in the goods account of the balance of payments compilation. The compilation of international merchandise trade statistics is usually based on customs records, which essentially reflect the physical movement of goods across borders, and follow international guidelines on concepts and definitions, which do not fully conform to the principles of the System of National Accounts (SNA) and the Balance of Payments Compilation. Goods are defined in the SNA as physical objects for which a demand exists, over which ownership rights can be established and whose ownership can be transferred from one institutional unit to another by engaging in transactions on markets. This is a preliminary release, full details would be published in the MONTHLY EXTERNAL TRADE STATISTICS report by the Department of Statistics, Malaysia, to be disseminated at 1201 hours, Friday, 11 th February 2011. + This report can be accessed through the homepages of the Department of Statistics, Malaysia (http://www.statistics.gov.my) under Latest Releases: Malaysian External Trade Statistics, Ministry of International Trade and Industry

(http://www.miti.gov.my) and Malaysia External Trade Development Corporation (http://www.matrade.gov.my).

The December 2010 data are not fully validated. The validated data would be updated in the annual publication of the External Trade Statistics, 2010.

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TABLE 1: SUMMARY OF MALAYSIAS EXTERNAL TRADE Year/ Period 2009P January February March April May June July August September October November December 2009 (Jan-Dec)p 2010 January February March April May June July August September October Novemberp Decemberi 2009 (Jan-Dec)p 2010 (Jan-Dec)
i

Total Exports Total Imports (RM Million) (RM Million)

Trade Balance (RM Million)

Total Trade (RM Million)

38,269.6 39,556.9 43,571.5 41,104.8 42,918.6 45,073.6 48,823.9 47,785.7 47,195.5 54,256.1 50,066.3 54,672.9 553,295.3

30,160.8 27,498.6 31,026.1 33,716.8 32,904.8 35,951.9 40,979.6 38,229.2 37,923.1 42,788.4 41,185.8 42,575.2 434,940.4

8,108.8 12,058.3 12,545.4 7,388.0 10,013.7 9,121.7 7,844.3 9,556.5 9,272.4 11,467.6 8,880.4 12,097.7 118,354.9

68,430.4 67,055.5 74,597.6 74,821.5 75,823.4 81,025.5 89,803.5 86,014.9 85,118.7 97,044.5 91,252.1 97,248.2 988,235.6

52,447.3 46,840.4 59,419.6 52,015.5 52,280.5 52,829.5 55,426.5 52,852.1 50,474.5 54,978.2 52,699.3 57,164.8 553,295.3 639,428.1

39,515.7 35,168.9 45,092.6 42,760.6 44,152.6 46,786.2 48,413.6 44,532.3 43,467.2 48,125.7 43,701.1 47,478.1 434,940.4 529,194.6

12,931.6 11,671.5 14,327.0 9,254.9 8,127.9 6,043.2 7,012.9 8,319.8 7,007.3 6,852.5 8,998.2 9,686.7 118,354.9 110,233.6

91,963.1 82,009.3 104,512.2 94,776.1 96,433.0 99,615.7 103,840.0 97,384.4 93,941.6 103,103.9 96,400.4 104,643.0 988,235.6 1,168,622.7

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TABLE 2: MAJOR EXPORT PRODUCTS December November 2010i 2010p RM Million RM Million 57,164.8 52,699.3 21,144.2 19,217.6 5,006.7 5,068.3 3,792.5 3,502.1 3,356.6 2,501.2 3,286.8 3,166.6 2,288.3 2,469.2 1,891.0 1,621.0 1,848.0 1,736.8 1,516.1 1,518.6 1,451.4 1,281.5 December 2009p RM Million 54,672.9 22,679.6 3,444.0 3,144.0 2,289.5 3,307.3 3,211.8 1,935.2 1,394.8 1,254.5 1,211.3

Products Total Exports Electrical & Electronic Products Palm Oil Chemicals & Chemical Products Refined Petroleum Products LNG Crude Petroleum Machinery, Appliances & Parts Manufactures Of Metal Optical & Scientific Equipment Rubber Products

TABLE 3: MAJOR EXPORT MARKETS December November 2010i 2010p RM Million RM Million 57,164.8 52,699.3 7,902.8 7,265.4 6,906.9 7,193.6 6,225.8 5,792.7 5,208.2 4,551.6 3,015.9 2,748.9 2,834.8 2,591.8 2,240.9 1,616.4 2,154.5 1,692.7 1,792.4 1,606.8 1,664.9 1,516.2 December 2009p RM Million 54,672.9 7,527.9 7,325.5 5,572.1 5,457.7 2,910.2 2,839.9 1,701.6 2,057.9 1,516.2 2,050.3

Markets Total Exports Singapore PRC Japan USA Thailand Hong Kong SAR India ROK Taiwan Netherlands

Source : Department of Statistics, Malaysia Compiled By: MATRADE Notes: p - provisional data i - interim data

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MALAYSIA EXTERNAL TRADE STATISTICS

DECEMBER 2010

CHART 1: MALAYSIAS MONTHLY EXTERNAL TRADE PERFORMANCE, 2004-2010

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