Malaysia’s economy to grow at moderate pace of 4.0 pct this year — World Bank
KUALA LUMPUR: Malaysia’s economy is projected to grow at a more moderate pace of 4.0 per cent this year, with domestic private sector spending is expected to be the main driver of growth amid an expected slowdown in external demand.
According to the World Bank, private consumption is forecast to expand at a slower but still relatively robust rate of 6.7 per cent in 2023, sustained by the ongoing improvement in labour market conditions as well as ongoing household income support from the government.
“Gross fixed capital formation (GFCF) is projected to increase by 4.2 per cent in 2023 (2022 estimate: 5.3 per cent), reflecting the continued flows of capital investments in the private and public sectors,” it said in its latest Malaysia Economic Monitor report entitled ‘Expanding Malaysia’s Digital Frontier’ released yesterday.
According to the report, capital expenditure in the private sector is expected to continue to be driven by ongoing and new multi-year investments in the technology-intensive manufacturing and services sectors.
“Capital spending by the government is expected to be mainly directed towards the upgrading of public infrastructure and amenities including the East Coast Rail Link (ECRL), Light Rail Transit 3 (LRT3), Mass Rapid Transit (MRT) 3, the Johor Bahru–Singapore Rapid Transit System (RTS Link), Sarawak-Sabah Link Road Phase 2, and Trans Borneo Highway,” it said.
Meanwhile, as the global environment becomes less supportive, World Bank said trade growth is expected to moderate in 2023, with Malaysia’s export growth projected to slow to 2.2 per cent this year, in line with softening global growth prospects and weakening international trade momentum. — Bernama