MALAYSIA'S EXPORTS TO RISE BY AT LEAST 13 PCT IN SECOND HALF OF 2011, SAYS KENANGA RESEARCH

KUALA LUMPUR, June 6 (Bernama) -- Malaysia's exports are expected to pick
up at a gradual pace and projected to climb by at least 13 per cent in the
second half of this year, says Kenanga Research.

It said with prices of food and fuel expected to moderate in the second
half and projects under the Economic Transformation Programme (ETP) initiating
head on, gross domestic product (GDP) growth is projected at around seven per
cent, from around 4.5 per cent in the first half.

"At this juncture, we continue to maintain our GDP projection for the whole
year at 5.7 per cent," it said in a note Monday.

The research firm said that as Western economies continue to battle
austerity measures due to escalating debt difficulties, the economic growth
scale has already begun to tilt towards East Asia and emerging economies.

"The rapid growth however, comes with a price, inflation.

"With a higher base to weigh on exports upside along with the impact of
Black Swans in the first quarter, exports growth in the first half is expected
to remain moderate at around 8.5 per cent year-on-year or a third of the pace it
recorded in the same period last year or 26.5 per cent," it added.

In a separate note, MIDF Research said Malaysian commodities export
shares to China eased. But this was compensated by higher export shares to the
United States and Japan.

"The recovery of the United States which is on course, and Japan's
rebuilding from the triple disaster expected to take-off in the second half of
2011, could compensate for any potential shortfall to China," it said.

MIDF also said Malaysia's April trade surplus of RM11.01 billion (US$3.67
billion) from RM11.34 billion (US$3.78 billion) in March was due to higher
export earnings from commodities which negated the decline in electrical and
electronics earnings.

"This is not surprising given that commodities prices are on an uptrend,"
it added.