Econ­omy ex­pands 4.2 per cent in 2016, sec­tors see growth

The Borneo Post - - FRONT PAGE -

KUALA LUMPUR: Malaysia’s econ­omy recorded a 4.5 per cent growth in the last quar­ter of 2016, un­der­pinned by con­tin­ued expansion in pri­vate sec­tor ex­pen­di­ture, lead­ing to a full year growth of 4.2 per cent.

The 2016 Gross Do­mes­tic Prod­uct (GDP) is how­ever, lower than the five per cent and six per cent reg­is­tered in 2015 and 2014 re­spec­tively.

On the sup­ply side, growth con­tin­ued to be driven by the man­u­fac­tur­ing and ser­vices sec­tors, Bank Ne­gara Malaysia (BNM) an­nounced yes­ter­day.

On a quar­ter-on-quar­ter sea­son­ally ad­justed ba­sis, the econ­omy recorded a sus­tained growth of 1.4 per cent (3Q 2016:1.4 per cent), it said.

“While the ex­ter­nal en­vi­ron­ment may con­tinue to re­main chal­leng­ing, the Malaysian econ­omy will ex­pe­ri­ence sus­tained growth with the pri­mary driver be­ing do­mes­tic de­mand,” it said in a state­ment.

The cen­tral bank said pri­vate con­sump­tion is an­tic­i­pated to re­main sup­ported by wage and em­ploy­ment growth, with ad­di­tional im­pe­tus com­ing from an­nounced gov­ern­ment mea­sures to sup­port dis­pos­able in­come of house­holds.

“In­vest­ment ac­tiv­ity will con­tinue to be an­chored by the on-go­ing im­ple­men­ta­tion of in­fra­struc­ture projects and cap­i­tal spend­ing in

While the ex­ter­nal en­vi­ron­ment may con­tinue to re­main chal­leng­ing, the Malaysian econ­omy will ex­pe­ri­ence sus­tained growth with the pri­mary driver be­ing do­mes­tic de­mand. BNM

the man­u­fac­tur­ing and ser­vices sec­tors,” it added.

Ex­plain­ing fur­ther the fourth quar­ter GDP growth, BNM said over­all, do­mes­tic de­mand ex­panded at a more mod­er­ate pace, as the im­prove­ment in pri­vate con­sump­tion and in­vest­ment ac­tiv­ity was more than off­set by the de­cline in pub­lic ex­pen­di­ture.

In the fourth quar­ter 2016, pri­vate con­sump­tion grew by 6.2 per cent ver­sus 6.4 per cent in the third quar­ter, sup­ported by con­tin­ued wage and em­ploy­ment growth.

Pri­vate in­vest­ment reg­is­tered growth of 4.9 per cent (3Q 2016: 4.7 per cent), fol­low­ing con­tin­ued cap­i­tal spend­ing in the ser­vices and man­u­fac­tur­ing sec­tors.

Growth of pub­lic in­vest­ment im­proved mainly on ac­count of higher spend­ing on fixed as­sets by pub­lic cor­po­ra­tion, but nev­er­the­less, re­mained in con­trac­tion dur­ing the quar­ter.

Pub­lic con­sump­tion also de­clined by 4.2 per cent (3Q 2016: +2.2 per cent) aris­ing from the ra­tio­nal­i­sa­tion of spend­ing on sup­plies and ser­vices and a mod­er­a­tion in the growth of spend­ing on emol­u­ments.

On the ex­ter­nal front, net ex­ports con­trib­uted pos­i­tively to growth as real ex­ports ex­panded at a faster rate than real im­ports.

As for the sup­ply side, growth in the man­u­fac­tur­ing, min­ing and agri­cul­ture sec­tors im­proved.

The man­u­fac­tur­ing sec­tor ex­panded at a faster pace ow­ing to higher growth in both do­mes­tic and ex­port-ori­ented in­dus­tries.

The min­ing sec­tor recorded an im­prove­ment due to an in­crease in nat­u­ral gas pro­duc­tion dur­ing the quar­ter.

In the agri­cul­ture sec­tor, eco­nomic ac­tiv­ity con­tracted at a slower pace, re­flect­ing the di­min­ish­ing im­pact of El Nino on crude palm oil yields.

Growth in the ser­vices sec­tor con­tin­ued to ex­pand, al­beit at a more mod­er­ate pace, sup­ported mainly by con­sump­tion-re­lated ser­vices.

In the con­struc­tion sec­tor, growth re­mained driven by the civil en­gi­neer­ing sub- sec­tor. — Ber­nama

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