(AFP) Malaysia's trade surplus declined sharply in March amid a marked fall in exports, according to official figures released today.

The Statistics Department said the RM4.2 billion surplus compared with RM7 billion a year earlier.

The trade surplus in February stood at RM6.5 billion ringgit, according to figures released last month.

Exports in March fell 6.9 percent year-on-year to RM29.8 billion while imports were up 2.2 percent at RM25.6 billion.

Exports of electrical and electronic products totalled RM16.7 billion, accounting for about 56 percent of total export earnings in March.

The growth in imports was due mainly to a 29.5 percent year-on-year increase in capital goods, the department said.

For the three months to March, the trade surplus stood at RM13.6 billion compared to RM16.5 billion a year earlier, as exports rose two percent to RM86.4 billion and imports grew 6.7 percent to RM72.8 billion.

Almost 21 percent of all Malaysia's exports go to the United States, making it vulnerable to the economic slowdown there.

Last month the independent Malaysian Institute of Economic Research cut its gross domestic product growth forecast for this year, to four percent from five percent.

The think-tank said the revision was based on the assumption that the US slowdown could get worse than expected, on the highly uncertain external environment and on the continuing weak Japanese economy.