Malaysia’s industrial output grows most in 10 months

December 8, 2007

Malaysia’s industrial production grew at the fastest pace in 10 months in October as rising exports and domestic demand boosted manufacturing and electricity output.

Overall production at factories, utilities and mines increased 4.7 percent from a year earlier, accelerating from a revised 3.1 percent gain in September, the Putrajaya-based Statistics Department said in a statement Friday. Economists were expecting a 5 percent increase.

“The export figure was pretty encouraging,” said Chua Hak Bin, an economist at Citigroup Inc. in Singapore. “There also are signs the economy is picking up. Consumption investment remains pretty strong. It looks like the economy is weathering the threat of a U.S. slowdown pretty well.”

Southeast Asia’s third-largest economy expanded 6.7 percent in the third quarter, the fastest pace in three years, after the government raised spending and cut corporate tax to bolster consumption and investment. Malaysia is also counting on commodities and other shipments to Asian economies such as China to drive growth amid weaker electronics sales to the U.S.

China’s appetite for Asian exports has helped the region’s economies withstand a slowdown in the U.S., where the worst housing recession since 1991 is crimping demand.

Chinese demand

Malaysia’s exports expanded 14.3 percent in October as sales of palm oil and chemicals to China made up for a 12 percent drop in shipments to the U.S. Sales of electrical and electronics goods, which made up 43 percent of total exports in October, grew just 0.4 percent, the first increase in at least nine months.

Factory output by companies including Malaysian Pacific Industries Bhd. and Unisem (M) Bhd. grew 4.6 percent in October, the biggest gain since December 2006.

Manufacturing accounts for more than 30 percent of Malaysia’s $149 billion economy, and manufactured goods make up almost four-fifths of the country’s overseas sales.

Higher manufacturing output was led by increased production of office and computing machinery and electronic valves and other components, the statistics department said.

Mining increased 3.8 percent, while electricity production gained 7.4 percent, the biggest increase in nine months.

Production rose 1.9 percent in the first 10 months of 2007 from a year earlier, as electricity output by Tenaga Nasional Bhd. and other power producers gained 4.1 percent, mining increased 3.2 percent, and manufacturing climbed 1.4 percent.

(Source: Bloomberg)

Source: http://www.tehrantimes.com/
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