ASIAN PRODUCERS AT RISK OF DISRUPTION FROM SHORTAGE OF JAPANESE COMPONENTS

KUALA LUMPUR, May 9 (Bernama) -- Asian producers are at risk of a disruption if a shortage of Japanese components slows production and reduces demand for other Asian-made components, says a Moody's Analytics.

"The potential for supply-chain disruptions resulting from Japan's natural disaster, to undermine regional output, presents a significant downside risk to Asia's export performance," said Moody's Analytics Associate Economist, Katrina Ell.

She said South Korea's export performance in April offers the first full month's insight into the impact of the disaster on a major trading partner.

"Korea's exports to Japan rose in April on the back of greater shipments of oil and steel products, necessary in Japan, because of energy blackouts.

"However, growth in later quarters will suffer if imports from Japan remain troubled and Korean manufacturers' inventories run out," she added.

The outlook came after data showed Asia's exports had performed solidly in the opening quarter of 2011.

"Robust demand within Asia along with the strengthening global recovery led to a buoyant export performance. Outside of Japan, the devastating natural disaster on March 11, did not dampen first quarter export performance," Ell's said.

However, the ultimate impact of Japan's natural disaster on Asia is still uncertain.

"On the upside, Japan is a heavy importer of energy and raw materials and will need more of these supplies than normal, to make up for local shortages and to begin reconstruction towards the end of the year.

"Commodity-exporting nations could see demand grow as a result," she said.

Meanwhile, excluding Japan, North Asia posted solid results in the first quarter of 2011, driven by strong export growth in China, Taiwan and South Korea due to the upbeat demand globally, and particularly within Asia.

The export sector in Southeast Asia also benefited in the first quarter from robust Asian demand and high commodity prices, despite a downtrend in growth as the early-2010 rebound fades.

"In Malaysia, exports rose in February at the fastest pace in seven months as manufacturers shipped more oil and gas products abroad, helping to sustain the country's robust trade surplus," Ell's said.