Malaysia has made great strides despite regional competition and the country made history in 2021 when total trade reached the RM2 trillion mark for the first time.
TIME passes by so fast that it almost feels like a year has passed in a blink of an eye and we are just days away from the new year. Looking back, the year 2022 was truly an outstanding milestone for Malaysia’s trade.
Creating homegrown export champions
In the current environment, considering the various political and geopolitical situations including market conditions and of course, the pandemic, Malaysia is ranked among the world’s Top 25 trading nations and Top 5 among Asean countries.
Overall, Malaysia made great strides despite regional competition and the country made history in 2021 when total trade reached the RM2 trillion mark for the first time.
This year, according to the Statistics Department, Malaysia’s total trade from January to November expanded by close to 30% to RM2.613 trillion.
Within this period, exports increased by 27.2% to reach RM1.42 trillion while imports rose by 33.3% to RM1.193 trillion.
Trade surplus edged up by 2.6% to RM227.89bil.
However, we must not rest on our laurels. We must continue our concerted efforts to ensure Malaysian micro small and medium enterprises (MSMEs) remain part of the global supply chain and be prepared for changes in global economic conditions.
Malaysia External Trade Development Corp (Matrade) is placing a strong emphasis on high-value industries, developing access into new and emerging markets and creating partnerships that are in line with Matrade’s key pillars – digitalisation, adopting values of sustainability and to be guided by the National Trade Blueprint.
We should be proud that we have strengths in high-value industries such as electrical and electronics, machinery and equipment, aerospace, medical devices, pharmaceuticals, healthcare, construction, chemicals, and energy, for a country with only 33 million people.
Along with the advancement of technology, cross-border eCommerce opportunities are also growing.
Hence, it is vital for Malaysian MSMEs to adopt digitalisation to be more competitive globally. In 2021, Gross Value Added of eCommerce amounted to RM201.1bil, an increase of RM37.2bil in 2021 with a growth of 22.7%.
In the same vein, we must also recognise our mid-tier companies (MTCs) significant efforts in contributing 30% of the gross domestic product and 22% of our Malaysian workforce.
Despite making up only 1% of businesses in Malaysia, MTCs play an important role in developing a competitive domestic supply chain, where 75% or more than 7,000 SMEs are involved in the MTCs export supply chain.
These achievements are testament to the success of Matrade’s programmes in both capacity-building and trade promotion. These capacity-building initiatives generate a pool of exporters that are later promoted into the international markets through various export promotion programmes abroad led by Matrade’s network of 46 trade offices around the world.
In the first 11 months of 2022, Matrade has facilitated 2,266 companies through its Market Development Grant; 486 companies through the eTRADE 2.0 programme; trained 7,999 individuals through its exporters training programmes; assisted 2,681 companies to access into the global markets through various export promotion activities implemented namely participation in trade fairs, international sourcing programmes, eBizMatch as well as eBizLink programmes. Matrade also produced countless market intelligence reports gathered from its global networks. These reports can be accessed by myExport registered users.
World-renowned trade promotion organisation
As a testament to the success in pivoting the impact of the pandemic, the 17th edition of Matrade’s flagship annual event – the Malaysia International HalalShowcase (Mihas) in 2021 had earned its first World Trade Promotion Organisation Award under the “Best Use of Information Technology” category, for Matrade’s innovative approach in organising a fully virtual showcase. Mihas 2021 was also recognised at the Malaysia Public Relations Awards 2021, clinching the Gold Award in the Best “Pandemic Pivot” or “Covid-19 Communications” campaign category adding another feather to the cap.
This year, the 18th Mihas once again delivered a record-breaking showcase, generating a total of RM2.36bil in sales, surpassing its original target of RM1.9bil.
Through Mihas, Matrade continues to fortify Malaysia as the heart of the global halal hub. In this regard, businesses must realise the vast opportunities available in the international halal market and strive to capitalise on them.
Matrade is ready to assist Malaysian exporters to tap into the opportunities of the global Islamic economy, which is estimated to reach US$2.8 trillion (RM12.4 trillion) by 2025.
Mihas 2023 will be held from Sept 12 to 15, 2023 at the Malaysia International Trade and Exhibition Centre, Kuala Lumpur. Close to 400 booths have already been reserved by this year’s exhibitors, which reflects Mihas’ positive rapport as a trade event.
Future-proofing Malaysia’s trade
The requirement to compete in international markets has changed significantly over the past few years.
Buyers, policymakers, numerous stakeholders, and consumers now have different expectations, not based on prices alone, but are also concerned about sustainability. Exporters must invest in developing sustainable strategies that promote and adopt environmental, social and governance principles while obtaining relevant certifications, standards, labelling and global endorsement in their production process and global supply chains in order to successfully meet changing market requirements.
Our MSMEs must also be prepared for the digital age, which goes beyond simply having websites and includes exposing them to cutting-edge technology like the metaverse.
Another key area is eCommerce marketing, which is fast becoming a necessity for companies to remain relevant.
At Matrade, we have long introduced a programme called the eTrade Programme (now eTrade 2.0) to expedite the learning and adoption of eCommerce marketing as a tool to export among our MSMEs.
With regard to international trade, Matrade urges all relevant parties to work with us to develop new areas of strength such as the services sector and environmentally friendly and highly innovative sectors.
Currently, Matrade has forged high-value partnerships with industry players across various segments namely, Google, DHL Express, CIMB, MGTC, the Standards and Industrial Research Institute of Malaysia and Bank Islam Malaysia Bhd, among many others.
As a way to acknowledge trade associations and their crucial role as a conduit between the public and private sector, Matrade launched the Empower Trade Association Programme (ETA) this year.
In addition to exploring new markets, we offered support and incentives through the ETA for the promotion of high-tech, high-value and sustainable industries to help more Malaysian businesses access the global value chain.
Pragmatic moves ahead
Malaysia can benefit from opportunities brought about by greater globalisation and regional economic integration through Regional Comprehensive Economic Partnership and Comprehensive and Progressive Agreement for Trans-Pacific Partnership by utilising its strategic location. Malaysia has a number of advantages that have helped it rise to the top, most notably a robust manufacturing sector and a prime location between East and South-East Asia.
The presence of Malaysian businesses in the global supply chain contributes to its stability and Malaysia can undoubtedly continue to solidify its position as a strong and reliable trading nation.
Matrade will continue to take the lead in helping Malaysian companies to access international markets and capitalise on the benefits of globalisation. I wish to reassure our Malaysian companies that Matrade will continue to help them access the world markets while also facilitating them in adapting to and benefiting from new market opportunities and conditions.
We are confident that our exporters will be the best bridge to articulate Malaysia’s value propositions that resonate with world demands. I am also sure, with all the strategies and tactical approaches in place, we can make Malaysia great in trade.
Datuk Mohd Mustafa Abdul Aziz is the chief executive officer of Matrade. The views expressed here are the writer’s own.
