Balance of Payment for Malaysia

The report given showed the balance of payment for Malaysia from year 2008 to year 2010. Malaysia had achieved positive value in the balance on goods and services because Malaysia exports more than import on their goods. However, some of the service sectors such as transportation and education were deficit due to Malaysian consumed other countries' services more compare to our services.

Malaysia's external position remained resilient in 2010, underpinned by a sizeable current account surplus and a lower net outflow in the financial account. The trade surplus narrowed as import growth outpaced export growth, but nevertheless, remained large. The services account recorded a small surplus, supported by higher receipts from tourism as well as computer and IT services .

However, the income account deficit widened due mainly to the higher profits of foreign direct investment in Malaysia. The lower net outflows in the financial account were largely attributable to the higher inflows of portfolio investments and FDI given the improvement in both global and domestic economic conditions. Outflows of direct investment abroad increased as Malaysian companies continued to tap opportunities in the regional and other markets.

The current account surplus narrowed to RM90.5 billion or 12.2% of GNI in 2010 (2009: RM112.1 billion or 17.5% of GNI). Trade activity recovered during the year as global economic conditions improved, particularly among regional countries. The financial account recorded a smaller net outflow of RM21.9 billion (2009: -RM80.2 billion). Net portfolio inflows increased in line with regional trend given the prospects for strong growth plus expectations for stronger regional currencies and higher interest rates.

The improving global economic conditions and corporate profitability, as well as more favourable investment climate led to higher inflows of FDI.

Direct investment abroad also rose

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