Economy to grow at five per cent in 2018

NEW YORK: The Conference Board, a New York-based global, independent business research association, has projected that Malaysia would record a five per cent gross domestic product (GDP) growth in 2018, slightly lower than the 5.5 per cent growth in 2017.

In its latest Global Economic Outlook 2018 released on Monday, it said Malaysia was not the only Asean country to face a decline as Thailand’s GDP growth was also projected to decline to three per cent in 2018 from 3.8 per cent in 2017.

The report attributed Malaysia’s economic slowdown to the decline in oil and other commodity prices, which were not likely to rise above their current levels next year.

Nevertheless, the overall global economy’s momentum is expected to continue, producing a three per cent global growth rate in 2018.

“Global growth has finally left the starting gate since the global economic and financial crisis, and GDP growth, which we predicted to grow at 2.8 per cent a year ago, is likely to end at about three per cent for 2017 and through 2018,” said Chief Economist of The Conference Board, Bart van Ark.

While the growth path of mature markets will remain solid in the short term, the potential for accelerated growth is limited, and a growth slowdown is likely to set in later in this decade.

“As some major emerging markets are maturing themselves, especially China, they are unlikely to return to growth trends of the past.

“The good news is that qualitative growth factors, such as an improvement in labour force skills, digitisation, and especially stronger productivity growth, may help to sustain growth and provide better conditions for businesses to thrive over the next decade,” he said.

The Conference Board said that the growth momentum in mature economies had intensified during 2017, and was projected to grow by 2.1 per cent in 2018 compared to 2.2 per cent in 2017.