Malaysian Economy Easing Pressure Points Chief Economist Suhaimi - - PowerPoint PPT Presentation

▶
malaysian economy
SMART_READER_LITE
LIVE PREVIEW

Malaysian Economy Easing Pressure Points Chief Economist Suhaimi - - PowerPoint PPT Presentation

Oct 09, 2023 150 likes •409 views

Malaysian Economy Easing Pressure Points Chief Economist Suhaimi Ilias | +603 2297 8682 | suhaimi_ilias@maybank-ib.com MALAYSIA RESEARCH TEAM Strictly Private & Confidential In summary Growth picking up after two years of slowdown

slide-1
SLIDE 1

Strictly Private & Confidential

Malaysian Economy

Easing Pressure Points…

Chief Economist Suhaimi Ilias | +603 2297 8682 | suhaimi_ilias@maybank-ib.com MALAYSIA RESEARCH TEAM

slide-2
SLIDE 2

Strictly Private & Confidential Page 1

In summary…

  • Growth picking up after two years of slowdown with potential upside

surprise to growth via external demand from current synchronised global economic pick up, firmer commodity prices, rebound in exports

  • MYR and external reserves stabilised after measures by BNM in early-Dec

2016 to ban offshore MYR NDF trade & repatriate 75% of export earnings

  • Firmer ASPs of key commodity exports ease concerns about current

account and fiscal balances; fiscal consolidation achieved/delivered despite challenges

  • Expected earnings recovery after three years of stagnancy is positive for

portfolio flows into equity & corporate capex

  • Remaining pressure point is foreign holdings of Malaysian bonds,

although offset by domestic liquidity amid sign of foreign selling bottoming

slide-3
SLIDE 3

Strictly Private & Confidential Page 2

Malaysia - Real GDP Growth

Source: Dept. of Statistics, MoF (Economic Report 2016/2017), MKE Economics Research

% chg % Share

  • f GDP

2014 2015 2016 2017E 2018E 2017E BNM (Mar 2017) 2017E MOF (Oct 2016) Real GDP 100.0 6.0 5.0 4.2 4.4 4.5 4.3-4.8 4.0-5.0 Manufacturing 23.3 6.2 4.9 4.4 4.5 4.3 4.3 4.1 Services 55.0 6.6 5.1 5.6 5.6 5.7 4.9 5.7 Agriculture 8.2 2.1 1.2 (5.1) 1.5 1.8 4.0 1.5 Mining 8.9 3.5 4.7 2.7 2.0 1.8 2.7 1.4 Construction 4.6 11.7 8.2 7.4 7.8 7.5 8.0 8.3 Domestic Demand 91.9 5.9 5.1 4.4 4.9 5.0 4.4 4.9 Private Consumption 53.4 7.0 6.0 6.1 5.9 5.8 6.0 6.3 Public Consumption 13.1 4.3 4.4 1.0 2.9 2.5 (0.2) 0.4 Gross Fixed Capital Formation 25.4 4.8 3.7 2.7 3.9 4.5 3.3 4.2 Private Investment 16.9 11.1 6.4 4.4 4.8 5.0 4.1 5.8 Public Investment 8.5 (4.7) (1.0) (0.5) 2.3 3.5 1.5 1.1 Net External Demand 8.1 13.2 (3.8) (1.8) (0.7) (0.9) 5.3 1.9 Exports of Goods & Services 70.1 5.0 0.6 0.1 1.3 3.0 2.2 2.5 Imports of Goods & Services 62.0 4.0 1.2 0.4 1.5 3.5 1.8 2.6 MAYBANK KE OFFICIAL ACTUAL

slide-4
SLIDE 4

Strictly Private & Confidential Page 3

Malaysia - Other Key Economic Indicators

Source: Dept. of Statistics, Bloomberg, MoF (Economic Report 2016/2017), MKE Economics Research, Maybank FX Research

2014 2015 2016 2017 YTD 2017E 2018E 2017E BNM (Mar 2017) 2017E MOF (Oct 2016) Gross Exports (% chg) 6.3 1.6 1.1 19.8 8.5 4.0 5.5 2.7 Gross Imports (% chg) 5.3 0.4 1.9 21.5 9.8 7.4 6.4 3.4 Trade Balance (RMb) 82.5 91.6 87.3 13.5 85.5 83.0 86.4 88.3 Current Account Balance (RMb) 47.3 34.7 25.2

  • 24.7

23.9 17.4 14.8 Current Account Balance (% of GDP) 4.3 3.0 2.0

  • 1.9

1.8 1.4 1.1 Fiscal Balance (% of GDP) (3.4) (3.2) (3.1)

  • (3.0)

(2.8) (3.0) (3.0) Inflation Rate (CPI, %) 3.1 2.1 2.1 4.3 3.5-4.0 2.0-2.5 3.0-4.0 2.0-3.0 Overnight Policy Rate (% p.a., end-period) 3.25 3.25 3.00 3.00 3.00 3.25

  • Exchange Rate (RM/USD, end-period)

3.50 4.29 4.49 4.40 4.40 4.25

  • Exchange Rate (RM/USD, average)

3.27 3.91 4.14 4.44 4.41 4.35 4.30-4.40

  • Unemployment Rate (%)

2.9 3.2 3.5 3.5 3.4 3.3 3.6-3.8 3.2 Crude Oil (USD/bbl, Brent average) 98.9 52.3 44.1 53.9 55 55 50-55 45 Crude Palm Oil (RM/tonne, average) 2,415 2,168 2,652 3,065 2,400 2,500 2,700 2,500 MAYBANK KE OFFICIAL ACTUAL

slide-5
SLIDE 5

Strictly Private & Confidential Page 4

Consumers spending growth despite weak consumer sentiment: Tapping

  • nto savings amid slowing income growth & de-leveraging

Consumer sentiment vs consumer spending indicators Slowing income growth amid pick in inflation Gross national savings down, EPF withdrawals up Household Debt

Source: BNM, DoS, EPF, MEF 5,000 6,000 7,000 8,000 9,000 10,000 11,000 12,000 13,000 25 27 29 31 33 35 37 39 1Q 2010 2Q 2010 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015 3Q 2015 4Q 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016 Gross National Savings Rate (% of GDP) Withdrawals from EPF (MYRm)

63% 66% 67% 66% 66% 64% 60% 72% 72% 76% 81% 86% 87% 89% 88% 2 4 6 8 10 12 14 16 18 50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 % of GDP % chg 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 2004 2006 2008 2010 2012 2014 2016 Avg Nominal Private Sector Salary Growth Inflation (CPI) Avg Real Private Sector Salary Growth 2 4 5 7 8 10 11 60 70 80 90 100 110 120 130 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 MIER: Consumer Sentiment Index Retail Trade Index (% YoY, RHS) Real Private Consumption (% YoY, RHS)

slide-6
SLIDE 6

Strictly Private & Confidential Page 5

Consumers spending growth despite weak consumer sentiment: Disposable income-boosting measures & higher commodity prices negate rising inflation

Source: Budget 2016 & 2017, EPF, MKE Economics Research

  • Up +25.9% in Budget 2017 to MYR6.8b (2016: +1.5% to

MYR5.4b). Without BR1M, real private consumption expenditure growth would be 0.4ppt lower in 2012-2016

BR1M

  • Option for 8% vs 11% for period Mar 2016 – Dec 2017
  • 50% workers opted, boosting disposable income by

MYR4b

Lower Workers’ Contribution to EPF

  • Minimum Wage: +11% in Peninsula Malaysia to

MYR1,000/month & +15% in East Malaysia to MYR920/month; benefit 27% of workers

Minimum Wage Increase; Civil Service Salary & Pension Revisions (both w.e.f. 1 July 2016)

  • CPO, Rubber
  • Positive for rural household income

Firmer ASPs of Agriculture Commodity Prices

slide-7
SLIDE 7

Strictly Private & Confidential Page 6

Consumers spending growth despite weak consumer sentiment: Tourism adds to measures to boost disposable income & higher commodity prices

Tourist arrivals xxx Spending in Malaysia by local & foreign credit card holders (% YoY) xxx…

Source: Tourism Malaysia, BNM

Inbound Tourism Expenditure, 2015: MYR74.1b

  • 12% of consumer spending; 6% of GDP

Domestic Tourism Expenditure, 2015: MYR61b

  • 10% of consumer spending, 5% of GDP

(25) (20) (15) (10) (5) 5 10 15 20 25 1.5 1.7 1.9 2.1 2.3 2.5 2.7 2.9 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Tourist Arrival (m) % YoY (RHS)

  • 25
  • 20
  • 15
  • 10
  • 5

5 10 15 20 25 30 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Credit Cards: Purchases: Domestic: Local Cardholders (% YoY) Credit Cards: Purchases: Domestic: Foreign Cardholders (% YoY)

slide-8
SLIDE 8

Strictly Private & Confidential Page 7

Consumers spending growth despite weak consumer sentiment: Tourism adds to measures to boost disposable income & higher commodity prices

Source: ForwardKeys

Popular destinations for Chinese travellers in 2017 Based on travel bookings between 16 March – 31 Aug 2017 (spring & summer seasons) CNTA bans Chinese travel agencies from selling tour packages to South Korea

slide-9
SLIDE 9

Strictly Private & Confidential Page 8

Better outlook for investment: Earnings recovery

Earnings recovery positive for capex

Source: DoS, MKE Equity Research

(4) (2) 2 4 6 8 10 12 14 16 18 20 22 2011 2012 2013 2014 2015 2016 2017E 2018E Maybank Equity Research Universe Earnings (% YoY) Real Private Investment (% YoY)

slide-10
SLIDE 10

Strictly Private & Confidential Page 9

Better outlook for investment: Surge in infrastructure activities

Construction Jobs Awarded – Record High for Infrastructure in 2016 (MYRb)

Source: CIDB

38 25 22 27 32 46 31 35 26 58 17 17 14 23 25 33 38 47 50 29 26 24 23 32 36 41 52 82 54 31 12 19 15 9 7 7 10 8 6 7 93 84 74 91 99 128 131 172 135 125 20 40 60 80 100 120 140 160 180 200 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Infrastructure Residential Non-Residential Social amenities Total

slide-11
SLIDE 11

Strictly Private & Confidential Page 10 Source: Bloomberg

BNM’s measures in early-Dec 2016 to ban offshore NDF & repatriate export earnings have stabilised MYR & external reserves

USDMYR: Exchange Rate & Volatility USDMYR USDMYR Volatility (Implied 1-month)

slide-12
SLIDE 12

Strictly Private & Confidential Page 11 90 100 110 120 130 140 150 15-Jan-13 15-Apr-13 15-Jul-13 15-Oct-13 15-Jan-14 15-Apr-14 15-Jul-14 15-Oct-14 15-Jan-15 15-Apr-15 15-Jul-15 15-Oct-15 15-Jan-16 15-Apr-16 15-Jul-16 15-Oct-16 15-Jan-17 15-Apr-17

BNM’s measures in early-Dec 2016 to ban offshore NDF & repatriate export earnings have stabilised MYR & external reserves

Malaysia’s External Reserves (USDb) Repatriation of Net Export Earnings (% of Trade Surplus) External Reserves, Net Portfolio Capital Flows, Trade Surplus (Quarterly Change in USDb) Repatriation of Net Export Earnings (USDm)

Source: BNM, CEIC

Down from USD98.3b in mid-Nov 2016 to USD94.3b in mid-Jan 2017, then up to USD95.7b at mid-Apr 2017

372.9 741.3 885.8 100 200 300 400 500 600 700 800 900 1,000 Dec-16 Jan-17 Feb-17 (15) (10) (5) 5 10 15 20 25 1Q 2009 2Q 2009 3Q 2009 4Q 2009 1Q 2010 2Q 2010 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015 3Q 2015 4Q 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016 Chg in External Reserves (USDb) Net Portfolio Capital Flows Trade Balance (USDb) 28 1 40 19 70 45 10 20 30 40 50 60 70 80 2006-2010 Jan 2011 - Nov 2016 Dec 2016 - Feb 2017 Dec 2016 Jan 2017 Feb 2017

slide-13
SLIDE 13

Strictly Private & Confidential Page 12

Fiscal consolidation target achieved / delivered despite challenges; Government debt & contingent liabilities contained

Fiscal deficit cut since 2010 and at pre-GFC levels since 2014 Government debt capped below 55% of GDP Government Debt & Contingent Liabilities (% of GDP) Government Debt & Contingent Liabilities (% chg)

Source: BNM, MoF

(3.4) (3.2) (3.1) (4.6) (6.7) (5.3) (4.7) (4.3) (3.8) (3.4) (3.2) (3.1) (3.0) (0.6) (7) (6) (5) (4) (3) (2) (1) 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017E 2018E 2019E 2020E 42.1 40.6 40.1 39.8 53.7 49.6 50.0 51.6 54.8 52.7 54.5 52.7 45.0 10 20 30 40 50 60 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017E 2018E 2019E 2020E Self-Imposed limit of 55% of GDP 42.1% 40.6% 40.1% 39.8% 50.8% 51.1% 51.5% 53.3% 53.0% 52.7% 54.5% 52.7% 10.2% 9.9% 9.4% 9.0% 11.8% 12.2% 13.2% 15.2% 15.4% 15.5% 15.4% 15.5% 52.3% 50.5% 49.5% 48.8% 62.7% 63.2% 64.7% 68.4% 68.4% 68.2% 69.9% 0% 10% 20% 30% 40% 50% 60% 70% 80% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Govt Debt Govt-Guaranteed Debt (Contingent Liability) 68.3% 5 10 15 20 25 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Govt Debt Govt-Guaranteed Debt (Contingent Liability) Total

slide-14
SLIDE 14

Strictly Private & Confidential Page 13

Firmer crude oil price ease concerns about current account & fiscal balances

Note: Above sensitivity analysis is based on historical data & ceteris paribus assumption Source: MKE Economics Research

Government O&G Related Revenues (ex Petronas Dividend): +MYR4.1b Fiscal Balance: +0.3% of GDP Current Account Balance: +0.4% of GDP MYR per USD: +0.40% to +0.45% Impact of USD10/bbl rise in annual average crude oil price… Impact of a 10% rise in crude oil price…

slide-15
SLIDE 15

Strictly Private & Confidential Page 14 Source: Bloomberg

Easing macroeconomic pressures  diminishing sovereign stress, default risk

Malaysia: Sovereign Credit Default Swap (CDS) Spread (5-Year, bps) Crude Oil Price Slump Current Account & Fiscal Balances 1MDB New BNM Governor…? MYR Peg & Capital Control…? Trump won US Presidential Election; BNM Measures

slide-16
SLIDE 16

Strictly Private & Confidential Page 15

Remaining key pressure point now is declining foreign holdings of Malaysian bonds, mainly on sell down in Government bonds

Monthly Net Foreign Flows: Equity & Bonds (MYRb) Cumulative Net Foreign Flows: Equity & Bonds (MYRb)

Source: Bloomberg, CEIC

(30) (25) (20) (15) (10) (5) 5 10 15 20 25 30 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14 Jan-15 May-15 Sep-15 Jan-16 May-16 Sep-16 Jan-17 Equity Debt (10) 10 20 30 40 50 50 100 150 200 250 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 Jan-14 May-14 Sep-14 Jan-15 May-15 Sep-15 Jan-16 May-16 Sep-16 Jan-17 Total Debt Equity (RHS)

slide-17
SLIDE 17

Strictly Private & Confidential Page 16

Remaining key pressure point now is declining foreign holdings of Malaysian bonds, mainly on sell down in Government bonds

Foreign Holdings of Malaysian Bonds (MYRm) Foreign Holdings of Malaysian Bonds (% Share of Total)

Source: CEIC

25,000 50,000 75,000 100,000 125,000 150,000 175,000 200,000 225,000 250,000 275,000 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 TOTAL MGS+GII MGS GII "Perfect Storm" Post-Brexit &Trump' Fed Rate HIkes "Taper Tantrum" 5 10 15 20 25 30 35 40 45 50 55 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Mar-15 May-15 Jul-15 Sep-15 Nov-15 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 TOTAL MGS+GII MGS GII "Perfect Storm" "Taper Tantrum" Post-Brexit &Trump' Fed Rate Hikes

slide-18
SLIDE 18

Strictly Private & Confidential Page 17

Remaining key pressure point now is declining foreign holdings of Malaysian bonds, mainly on sell down in Government bonds - maturity-driven as well

MGS & GII Maturity in 2017 3Y & 10Y MGS Yields, USDMYR

Source: BPAM, Maybank Fixed Income Research

Maturity Dates MGS/GII MYRb 15 Feb MGS 2/2007 3.814% 15.02.2017 8.8 15 Mar MGS 2/2014 3.394% 15.03.2017 10.5 15 June Profit-Based GII 2/2007 15.06.2017 3.0 30 Aug Profit-Based GII 2/2012 30.08.2017 9.5 15 Sep MGS 2/2010 4.012% 15.09.2017 14.0 31 Oct MGS 2/2012 3.314% 31.10.2017 13.5 23 Nov GII MURABAHAH 1/2014 3.678% 23.11.2017 7.5 MGS Sub-Total 46.8 GII Sub-Total 20.0 TOTAL 66.8 Estimated Foreign Holdings 30-35 3Y MGS Yield 10Y MGS Yield USDMYR (inverted)

slide-19
SLIDE 19

Strictly Private & Confidential Page 18

Remaining key pressure point now is declining foreign holdings of Malaysian bonds, mainly on sell down in Government bonds – but not broad-based

Source: BNM, Maybank Fixed Income Research (estimates for end-Mar 2017)

Composition of Foreign Holders of Malaysian Government Bonds

end-Dec 2015 end-Mar 2016 end-June 2016 end-Sep 2016 end-Dec 2016 end-Mar 2017 Asset Management MYRb 76.5 76.5 75.4 79.1 79.8 62.3 % Share of Total Foreign Holdings 44 41 37 38 42 40 Central Banks / Governments MYRb 50.4 50.4 55.0 58.3 57.0 56.1 % Share of Total Foreign Holdings 29 27 27 28 30 36 Pension Funds MYRb 20.9 24.3 30.6 31.2 32.3 32.7 % Share of Total Foreign Holdings 12 13 15 15 17 21 Banks MYRb 15.6 28.0 36.7 31.2 15.2 0.0 % Share of Total Foreign Holdings 9 15 18 15 8 Insurance Companies MYRb 1.7 1.9 4.1 4.2 3.8 3.1 % Share of Total Foreign Holdings 1 1 2 2 2 2 Nominees / Custodians MYRb 7.0 3.7 2.0 4.2 1.9 0.0 % Share of Total Foreign Holdings 4 2 1 2 1 Others MYRb 1.7 1.9 2.0 2.1 0.0 0.0 % Share of Total Foreign Holdings 1 1 1 1 TOTAL MYRb 173.8 186.7 203.9 208.3 190.0 155.7 % Share of Total Foreign Holdings 100 100 100 100 100 100

slide-20
SLIDE 20

Strictly Private & Confidential Page 19

Externally, the main issue is US trade policy: “Shifting sands…”

Source: Bloomberg, Media, MKE Economics Research

TRADE WAR; PROTECTIONISM…? TRADE DEALS; NEW WORLD TRADE ORDER (BILATERALISM; FAIR TRADE)…?

US out of TPP (done via Executive Order signed

  • n 23 Jan 2017); US review or quit NAFTA;

Border Tax / Border Adjustment Tax; Punitive import tariffs on China, Mexico

  • Pres. Trump’s First 100-Day plan that included

decision to review or quit NAFTA has lapsed Appointment of China critics & free-trade skeptics in Pres. Trump’s Administration e.g. Wilbur Ross (Commerce Secretary), Peter Navarro (Director of National Trade Council). Accused China, Japan, Germany of currency manipulations; unfair trade practices. China, Japan, Germany leaders’ visits to US & talks with Pres. Trump Executive Order on 31 Mar 2017 to investigate “trade abuses” targeting countries that are top sources of US trade deficit US did not label China a “currency manipulator” (in exchange for China’s 100-day plan to address trade imbalance with US after

  • Pres. Xi Jinping visit to meet Pres. Trump, and

help in dealing with North Korea …???) China, Japan, Germany, South Korea, Taiwan, Switzerland in “watch list” of US Treasury’s 14 Apr 2017 report on major trading partners’ FX policies

slide-21
SLIDE 21

Strictly Private & Confidential Page 20

Externally, the main issue is US trade policy: US-China trade relationship is key - Bilateral trade balance (USDb, 2016)

Source: CEIC

(347) (69) (65) (63) (36) (32) (29) (28) (25) (24) (19) (16) (14) (13) (13) (12) (2) 9 28 (400) (350) (300) (250) (200) (150) (100) (50) 50 China Japan Germany Mexico Ireland Vietnam Italy South Korea Malaysia India Thailand France Switzerland Taiwan Indonesia Canada Philippines Singapore HK

slide-22
SLIDE 22

Strictly Private & Confidential Page 21

Externally, the main issue is US trade policy: US-China trade relationship is key – North East Asia & Vietnam more vulnerable than rest of ASEAN

Source: CEIC, MKE Economics Research

Country Share of Exports to China to Total Exports Share of Exports to US to Total Exports Share of Exports to China & US to Total Exports Japan 18% 20% 38% South Korea 25% 13% 38% Taiwan 26% 12% 38% Hong Kong 54% 9% 63% Singapore 13% 7% 20% Malaysia 13% 10% 23% Thailand 11% 11% 22% Indonesia 11% 11% 22% Philippines 11% 15% 26% Vietnam 11% 21% 32%

slide-23
SLIDE 23

Strictly Private & Confidential Page 22

Externally, the main issue is US trade policy: Asia’s Top-3 Exports to US

Source: CEIC, MKE Economics Research

Country Products & Commodities % of Total Exports to US China

  • Electrical Machinery & Equipment
  • Machinery
  • Miscellaneous Manufacturing Article
  • 24%
  • 20%
  • 12%

Japan

  • Motor Vehicles
  • Electrical Machinery
  • Parts of Motor Vehicles
  • 31%
  • 14%
  • 6%

HK

  • Telecommunication & Sound Recording & Reproducing Equipment
  • Electrical Machinery, Apparatus & Appliances
  • Articles of Apparel & Clothing Accessories
  • 20%
  • 16%
  • 14%

South Korea

  • Road Vehicles
  • Telecommunication & Sound Recording Apparatus
  • Electrical Machinery
  • 32%
  • 13%
  • 19%

Taiwan

  • Information, Communications & Audio Video Products
  • Chemicals & Related Products
  • Iron & Steel
  • 24%
  • 11%
  • 10%

Singapore

  • Machinery & Transport Equipment
  • Electronics & Electrical
  • Miscellaneous Manufacturing Article
  • 34%
  • 32%
  • 16%
slide-24
SLIDE 24

Strictly Private & Confidential Page 23

Externally, the main issue is US trade policy: Asia’s Top-3 Exports to US

Source: CEIC, MKE Economics Research

Country Products & Commodities % of Total Exports to US Indonesia

  • Miscellaneous Manufacturing Article
  • Machinery & Transport Equipment
  • Food & Live Animals
  • 44%
  • 14%
  • 12%

Malaysia

  • Electrical Machinery, Apparatus & Appliances
  • Telecommunication & Sound Recording & Reproducing Equipment
  • Office Machinery & Automatic Data Processing
  • 46%
  • 19%
  • 9%

Thailand

  • Machinery
  • Electrical Machinery & Equipment
  • Rubber & Related Products
  • 26%
  • 21%
  • 9%

Philippines

  • Electrical Machinery & Equipment
  • Boilers & Machinery
  • Photographic & Medical Equipment & Instruments
  • 38%
  • 13%
  • 6%

Vietnam

  • Articles of Apparel & Clothing Accessories
  • Footwear
  • Wood Products
  • 42%
  • 14%
  • 9%

Note: E&E & ICT-related products are “common feature”; auto key for Japan & Korea; commodity-based exports also important for Indonesia, Thailand & Vietnam; “Clothing & Footwear” unique to HK & Vietnam

slide-25
SLIDE 25

Strictly Private & Confidential Page 24 DISCLAIMER This presentation is for information purposes only and is not intended to provide personal investment advice and does not take into account the specific investment objectives, the financial situation and the particular needs of persons who may receive or read this presentation. Investors should therefore seek financial, legal and other advice regarding the appropriateness of investing in any securities or the investment strategies mentioned in this presentation. The information contained herein has been obtained from sources believed to be reliable but such sources have not been independently verified by Maybank Investment Bank Bhd and consequently no representation is made as to the accuracy or completeness of this presentation by Maybank Investment Bank Bhd and it should not be relied upon as such. Accordingly, no liability can be accepted for any direct, indirect or consequential losses or damages that may arise from the use or reliance of this presentation. This presentation may contain forward looking statements which are often but not always identified by the use of words such as “anticipate”, “believe”, “estimate”, “intend”, “plan”, “expect”, “forecast”, “predict” and “project” and statements that an event or result “may”, “will”, “can”, “should”, “could” or “might” occur or be achieved and other similar expressions. Such forward looking statements are based on assumptions made and information currently available to us and are subject to certain risks and uncertainties that could cause the actual results to differ materially from those expressed in any forward looking statements. Readers are cautioned not to place undue relevance on these forward-looking statements. Maybank Investment Bank Bhd expressly disclaims any obligation to update or revise any such forward looking statements to reflect new information, events or circumstances after the date of this publication or to reflect the occurrence of unanticipated events. This presentation copy may not be reproduced, altered in any way, transmitted to, copied or distributed to any other party in whole or in part in any form or manner without the prior express written consent

  • f Maybank Investment Bank Bhd and Maybank Investment Bank Bhd accepts no liability whatsoever for the actions of third parties in this respect.

This presentation is not directed to or intended for distribution to or use by any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.