Thu. May 19th, 2022

Malaysia’s economy will grow by 5.4 percent in 2014 and 4.6 percent next
year, as exports have improved and the tightened fiscal and monetary
policies have taken effect, the World Bank (WB) has said.

In
its annual Economic Monitor report, the WB said exports, the backbone of
the Malaysian economy, will increase 6.3 percent this year and 6.2
percent in 2015, due to rising global demand for the country’s key goods
such as oil and gas and electronic products.

The bank lauded the Malaysian Government for its subsidy rationalisation programme, especially new fuel subsidy for the poor.

Minister in the Malaysian Prime Minister’s Department Datuk Seri Abdul
Wahid Omar said the Government spent some 23.5 billion RM (7.31 billion
USD) in fuel subsidy, bringing the cumulative total to 136 billion RM
(42.33 billion USD) over the past 14 years.

The report said
that high levels of household debt were a risk to growth. Household
debts in Malaysia climbed to 86.5 percent of its GDP in 2013, among the
highest in Asia.

The central bank of Malaysia is expected to
begin raising interest rates in July for the first time in three years,
partly due to financial imbalances such as consumer indebtedness.
Currently, the benchmark interest rate imposed by the bank is 3 percent.

Regarding investments, the bank said improved global economy and the
approval of the over-400-hectare Pengerang Integrated Complex will
result in higher investment inflow as well as growth in capital goods
imports.-VNA

By vivian