GFCF rises by 2.7 per cent in 2016

KUALA LUMPUR: Gross fixed capital formation (GFCF) rose by 2.7 per cent in 2016, stimulated by better growth in services and sustained momentum in manufacturing, said Department of Statistics Malaysia.

It said the contraction in mining and quarrying sector, however, influenced the investment performance in 2016.

The department said fixed asset investment was continuously led by the private sector.

“In nominal terms, GFCF rose to RM316.8 billion compared to RM302.6 billion in the preceding year,” it said.

Services posted a growth of 5.2 per cent compared to 3.5 per cent in 2015, driven mainly by the finance, insurance, real estate and business services which grew by 13.5 per cent compared to 13.7 per cent in 2015, it said.

The 2.9 per cent rebound in transportation and storage and information and communication, as compared to minus 5.8 per cent in 2015, supported the overall growth, it said.

However, the department said, other services, including government services, projected a reverse trend to minus 1.4 per cent as compared to 0.4 per cent in 2015.

The private sector, with a 66.6 per cent holding in GFCF, remained the catalyst for Malaysia’s investment with a growth of 4.3 per cent in 2016 while investment in the public sector declined to 0.5 per cent from a minus 1.1 per cent in 2015, it said.

Services and manufacturing activities were the main impetus in the private sector’s GFCF, it said.

It said the share of services stepped-up to 54 per cent compared to 51.8 per cent in 2015 while manufacturing maintained its position as the second contributor with 24.9 per cent compared to 24.7 per cent in 2015.

GFCF of the public sector was largely dominated by services, and mining and quarrying activities with a share of 66.8 per cent and 22 per cent respectively, while the manufacturing share improved to 10.6 per cent compared to 8.3 per cent in 2015, attributed by petroleum and chemical downstream activities, it said.