Malaysia’s trade surplus narrowed in April, as a significant rise in imports, driven by capital goods, outpaced the growth in exports, according to official data released on Tuesday.

The Ministry of Investment, Trade, and Industry (MITI) reported that during a 90-day suspension of broad US tariffs, the trade surplus dropped to RM5.19 billion, marking a 33% decline compared to the same month last year and a steep 79% fall from March.

Gross imports climbed to RM128.37 billion in April, a 20% year-on-year increase, driven by robust inflows of electrical and electronic products, along with machinery, equipment, and parts.

Capital goods imports more than doubled, primarily fuelled by a surge in non-transport capital goods, The Edge Malaysia reports.

In contrast, imports of intermediate goods, materials and components used in the production of finished goods like vehicles and computers, fell by 1.7%, mainly due to a decline in imports of primary fuel and lubricants.

Imports of consumption goods dipped by 0.7% in April, reflecting weaker demand for processed household food and beverages.

Furthermore, on the export side, total shipments rose 16.4% to RM133.56 billion, fuelled by strong demand for electronics and machinery, particularly from the US and Taiwan.

Exports of electrical and electronic products, which made up over 45% of total exports, surged 35.4% year-on-year, while exports of machinery, equipment, and parts jumped 31%. In contrast, petroleum product exports declined by 9.3%.

By market, exports to China, Malaysia’s largest trading partner, fell 2.8% year-on-year, while exports to the United States surged by 39%.

In response to global trade headwinds, MITI said on Tuesday that it, along with its export promotion agency Matrade (Malaysia External Trade Development Corporation), is stepping up efforts to boost exports and diversify export destinations.