According to a recent report released by the world bank, Malaysia's economy is expected to grow by 5.5% this year driven by the recovery of domestic demand, export growth and the reopening of the border. Meanwhile, according to the latest official data of Malaysia, the country's foreign trade grew strongly in the first quarter, with a year-on-year increase of 23.6%. Analysts believe that as an economy with a high degree of dependence on foreign trade, Malaysia's foreign trade performance is bright, releasing an optimistic signal of economic recovery. However, the conflict between Russia and Ukraine, the US Federal Reserve's interest rate hike and the impact of the COVID-19 on the supply chain have brought more external risks. Malaysia should seize the new opportunities of the regional comprehensive economic partnership agreement (RCEP) to inject new impetus into the economic recovery. Outstanding foreign trade performance According to the latest statistical report of the Ministry of international trade and industry of Malaysia, Malaysia's foreign trade volume rose rapidly in the first quarter of this year, reaching 624.86 billion ringgit (about 4.36 ringgit per US dollar), a year-on-year increase of 23.6%, of which exports increased by 22.2% and imports increased by 25.2%; The trade surplus increased by 10.9% to 65.08 billion ringgit. The report said that the rapid growth of exports was mainly supported by the export of electronic products, petroleum and chemical products. In the first quarter, the export of agricultural products dominated by palm oil and related manufactured products increased by 49.8% year-on-year to 27.22 billion ringgit; Mineral exports dominated by crude oil and liquefied natural gas surged 58.9% year-on-year to rm24.41 billion. Statistics show that China remains Malaysia's largest trading partner and an important driving force for Malaysia's foreign trade recovery. In March 2022, Malaysia China trade achieved double-digit growth for 16 consecutive months. According to the world bank, Malaysia is an open economy with an average foreign trade scale of 130% of GDP since 2010. Opening up to trade and investment is an important way for Malaysia to create employment and increase income. About 40% of employment is related to export activities. RCEP brings new opportunities According to the statistics of the Malaysian government, the trade between Malaysia and RCEP members increased rapidly in March. Among them, the trade volume with other ASEAN member countries increased by 37.6% year-on-year to 65.78 billion ringgit, and the trade volume with Japan increased by 16.7% year-on-year to 16.1 billion ringgit; The trade volume with China, South Korea, Australia and New Zealand has increased significantly. Malaysian analyst Azmi Hassan believes that RCEP officially entered into force for Malaysia on March 18. The government should speed up its steps to further eliminate non-tariff barriers, reduce trade costs and promote the development of foreign trade. Hassan told Xinhua that RCEP members, including China, Japan, South Korea, Australia and other large economies, will contribute to Malaysia's economic development. Recently, the Malaysian business community held a series of forum activities with RCEP as the theme. "The Malaysian government has taken RCEP as a major opportunity for economic recovery in the post epidemic era," Zhang Min, President of the General Chamber of Commerce of Chinese enterprises in Malaysia, told reporters a few days ago Increased external risk Although the foreign trade situation in the first quarter was gratifying, Malaysian economic observer karmelo felito believed that the government needed to take measures to ensure the stability of the domestic economic situation and achieve sustainable recovery, so as to provide a more friendly business environment for domestic and foreign investors. He suggested that the government further relax the restrictions on the labor market, introduce appropriate stimulus policies and tax reform, and implement a plan to gradually reduce expenditure to curb inflation and avoid further easing monetary policy. The World Bank report warned that if the global economic situation worsens under the circumstances of the conflict between Russia and Ukraine, the tightening of US monetary policy and the impact of the epidemic on the supply chain, Malaysia's economic growth may slow down to 4.8%. Among them, the US monetary policy will have a direct impact on Malaysia and other countries that rely on short-term capital flows. If the Federal Reserve raises interest rates by 25 basis points, it may reduce Malaysia's economic growth by 0.4 percentage points. Nur shamsiya mohad Yunus, governor of the National Bank of Malaysia (central bank), said recently that the country's monetary policy is still suitable for the current economic growth and inflation expectations. Malaysia is ready to face future challenges, and inflation is expected to be between 2.2% and 3.2% this year. The National Bank of Malaysia said at the end of March that with the support of the continuous expansion of external demand, the reopening of borders, the improvement of the labor market and the measures to boost the budget, the Malaysian economy will continue to maintain the momentum of recovery and is expected to grow by 5.3% to 6.3% this year. (Xinhua News Agency)