12/02/2008 (Forbes), Kuala Lumpur - Malaysia said on Tuesday it expects exports to continue to trend upward this year after growing by 2.7 percent in 2007, helped by strong demand in Asia.

Southeast Asia's third-largest economy in 2007 also registered its 10th consecutive year of trade surplus. The Ministry of International Trade and Industry (Miti) said Malaysia recorded a trade surplus of 100.53 billion ringgit in 2007, the second-highest ever in the country's history.

Total trade in 2007 grew 3.7 percent to a record 1.1097 trillion ringgit from 1.0697 trillion ringgit in 2006. This is the second year that Malaysia's total trade has surpassed the 1-trillion-ringgit mark.

Exports were valued at 605.1 billion ringgit, up 2.7 percent from 2006.

Imports grew 4.9 percent to 504.57 billion ringgit.

'The predominance of Asia in Malaysia's export markets was a major factor that enabled Malaysia to sustain its export growth in 2007,' Trade and Industry Minister Rafidah Aziz told a news conference. 'Asia, led by China and Asean, is expected to continue to be the major contributor to Malaysia's export growth this year.''

Malaysia's exports to the US, a major buyer of Malaysian-made electronic and electrical products, slumped 14.5 percent in 2007. Weaker demand from US consumers was offset by strong growth in exports to emerging markets.

Exports to Asia, which grew 6.2 percent last year, contributed 63 percent to total exports. A decade ago, Asia only accounted for a 55 percent share of Malaysia's total exports.

Exports to traditional and emerging markets such as China, Japan, Australia and Indonesia climbed 14.6 percent, significantly higher than the 2.7 percent rise in Malaysia's total exports.

'We expect the upward trend to continue (into 2008),' said Rafidah, who declined to give an exact forecast. 'We will be happy with any incremental amount (in exports),' she said.

Rafidah said she was being 'realistic'' about Malaysia's trade performance in 2008, pointing to the World Bank's reduced growth forecasts for the global economy and global trade this year.

The World Bank has forecast a moderation in global economic growth to 3.3 percent in 2008, compared to 3.6 percent in 2007. It is also forecasts global trade expanding at a slower rate of 7.6 percent against 9.2 percent in 2007.

In 2007 manufactured products continued to dominate Malaysia's exports, making up 74.8 percent of total exports, while mineral and mineral fuels accounted for 14 percent. Agriculture products accounted for 9.5 percent.

By value, exports of manufactured products rose slightly to 452.48 billion ringgit from 451.75 billion ringgit in 2006.

Most of the products in the manufacturing sector registered an expansion, with significant increases in chemicals and chemical products, which grew by 14.3 percent to 33.25 billion ringgit.

Exports of machinery appliances and parts grew 10.3 percent to 31.9 billion ringgit.

Agricultural exports recorded robust growth of 24.4 percent to 57.7 billion ringgit.

In 2007, the value of palm oil exports surged 45.5 percent to 37.5 billion ringgit, driven by high prices of crude palm oil. However, palm oil exports by volume dropped 4.8 percent to 13.74 million tons.

Meanwhile, Miti said the trade surplus in December narrowed to 9.6 billion ringgit from the revised 10.39 billion ringgit registered in November.

Total trade in the month was 98.61 billion ringgit, against a revised 98.52 billion ringgit in November.

Exports in December increased to 54.11 billion ringgit from 52.53 billion a year earlier.