Malaysia’s IPI rebounds to 0.7% in July 2023

KUALA LUMPUR: Malaysia’s Industrial Production Index (IPI) rebounded to 0.7 per cent year-on-year (y-o-y) in July 2023, spurred by the mining and electricity sectors, said the Department of Statistics Malaysia (DoSM).

Chief statistician Datuk Seri Mohd Uzir Mahidin said the IPI returned to positive territory in July 2023, from the – 2.2 per cent contraction in June 2023.

“The marginal increase in July 2023 was backed by the expansion in the mining sector (July: +4.2 per cent, June: -6.4 per cent) and the electricity sector (July: +1.5 per cent, June: +2.8 per cent).

“Meanwhile, the manufacturing sector continued to decline, albeit with a smaller decrease of 0.2 per cent (June: -1.6 per cent),” he said in a statement today.

On a month-on-month (m-o-m) comparison, he noted that the IPI fell by 1.8 per cent, contrasting with the positive growth of 2.2 per cent in June 2023.

He also noted that the manufacturing output was supported by the expansion in the domestic-oriented industries (July: 6.0 per cent, June: 4.1 per cent)

“The growth was propelled mainly by the double-digit growth of 11.9 per cent in the manufacture of motor vehicles, trailers and semi-trailers.

“Additionally, the manufacture of fabricated metal products (except machinery and equipment), as well as the manufacture of food processing products also supported the growth at 6.9 per cent and 7.0 per cent, respectively,” he said.

Meanwhile, Mohd Uzir said the export-oriented industries, which account for about two-thirds of the manufacturing output, remained on a downward trend at – 2.7 per cent (June 2023: -3.9 per cent).

This was primarily influenced by the decline in the manufacture of coke and refined petroleum products (-10.1 per cent), the manufacture of computer, electronics and optical products (-9.0 per cent); and the manufacture of rubber products (-1.6 per cent).

“This was in line with the country’s export performance which dropped by 13.1 percent in July 2023,” he said.

Mohd Uzir also highlighted that the output in the mining sector rose to 4.2 per cent in July 2023 from – 6.4 per cent in June 2023, driven by crude oil and condensate which registered double-digit growth of 11.8 per cent (June 2023: -4.5 per cent), while natural gas posted a smaller decline of 0.8 per cent (June 2023: -7.8 per cent).

At the same time, electricity output rose by 1.5 per cent in July 2023 (June: 2.8 per cent).

He also noted that in the first seven months of 2023 (7M2023), the IPI expanded at a slower rate of 1.2 per cent y-o-y (7M2022: 6.4 per cent), with all sectors posting positive growth, namely manufacturing index (1.4 per cent), mining index (0.3 per cent) and electricity index (1.6 per cent). – BK