Malaysia has set up an export development body to monitor and enhance the country’s export performance, particularly that of the services and manufacturing sectors.
Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah said the Malaysian Export Council, set up last week, is chaired by Prime Minister Datuk Seri Najib Tun Razak with the working committee headed by the Ministry of International Trade and Industry.
The council, he added, will “monitor closely new opportunities for export market and against the backdrop of lower ringgit.” It will focus particularly on services and manufacturing, “given that they are major contributors to our exports,” according to a report by Bernama, Malaysia’s national news agency.
The council will also look for ways to improve the competitive edge of other export-oriented industries which have not been performing well.
“We cannot deceive ourselves and solely rely on the lower ringgit to help push exports,” he said.
The National Export Council will focus on three major aspects to strengthen Malaysia’s export structure—export chain, logistics, and output, Ahmad Husni said earlier.
“With the ringgit’s depreciation, exports and imports will increase. In terms of import, the level of trade could be about equal but since the value of the U.S. dollar has appreciated, it could become higher. As such, the gap between exports and imports is quite narrow,” he said.
Part of the plan is for the country to export directly since it currently sends shipments to the final destination via third countries. We want to export directly so that the country can accrue higher returns, he added.
As for logistics, Malaysia’s performance is yet to reach 100% as there are many sectors which have no direct flight to their intended destination but have to transport their goods via third countries, Ahmad Husni added.
Study of ringgit
Meanwhile, the national government is reportedly conducting a comprehensive study on the ringgit’s depreciation.
International Trade and Industry Minister Datuk Seri Mustapa Mohamed said the study is being jointly undertaken by his ministry, Bank Negara Malaysia, Ministry of Finance, and the Economic Planning Unit of the Prime Minister’s Department to ascertain the impact of the falling ringgit on the economy.
Mustapa said that the country being a trading nation, the depreciation of the ringgit would definitely have an effect, and it was necessary for the study to determine its impact on imports, exports, inflation, manpower, and others.
He also said the question of pegging the ringgit against the US dollar did not arise as the move also has its positive and negative impact.
Photo: Hajotthu
