MALAYSIA’S overall balance of payments surplus for the three months to March rose 56.7% to RM24.6bil from RM15.7bil in the preceding quarter to December 2003.
“The sharp improvement was attributed to a wider surplus in the current account and a positive reversal in the financial account,” MIDF Bhd senior economist Azrul Azwar said.
The statistics department said in a release yesterday the current account surplus expanded 38.9% to RM15bil during the first quarter 2004, from RM10.8bil in the preceding quarter.
The increase was mainly due to the lower deficit in the services account from RM4.2bil in the previous quarter to just RM400mil for the three months ended March 2004.
“The travel component recorded a higher surplus of RM5.2bil from RM4.3bil previously, as travel earnings gained on higher tourist arrivals during the period,’’ the department said.
Figures from Tourism Malaysia show that at end-March, the country had received four million tourists. The board is targeting 14.4 million visitors to the country this year, after a 20% drop to 10.5 million last year owing to the SARS outbreak.
The current account was also boosted by the higher surplus in the goods account, which had improved marginally to RM24.3bil at end-March.
Exports and imports were down slightly at RM107.9bil and RM83.6bil respectively, compared with RM109.2bil and RM85bil in the final quarter 2003.
On the other hand, the better performance on Bursa Malaysia in January-March period had encouraged foreign investors to pump more funds into the local equity market.
This had a positive impact on the financial account balance, which turned around to a net inflow of RM8.6bil from a net outflow of RM2.3bil in the quarter to December 2003.
The department credited the reversal to a hefty net inflow of portfolio investment of RM15.9bil, or triple the amount that flowed in during the previous quarter.
Economists said that the net inflow of portfolio investment, or investment in Malaysian stocks during the period, contributed to the KL Composite Index's surge to a shade under 800 points at the start of the year and closing at 901 on March 31.
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