GDP expected to grow next year

KUALA LUMPUR: International agencies have forecast that Malaysia’s gross domestic product (GDP) in 2021 will be in the range of 6.3% to 7.5%.

Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said the projections are subject to Malaysia’s continued success in managing Covid-19, as well as in steering and nurturing the economy towards recovery and growth.

“As Malaysia is an open economy, whether our growth will be a U-shaped or V-shaped recovery will also depend on external factors such as the recovery of our major trading partners and restoration of global supply chains,“he said in his sppech at Invest Malaysia 2020 yesterday.

“Everyone has been urged to continue complying with the standard operating procedures for various sectors and activities to prevent new infections in the country.”

He said for 2020, the GDP is estimated to be within the range of -3.8% to 0.5% by various agencies.

Bank Negara Malaysia has projected economic growth to be within -2.0% to 0.50% while the International Monetary Fund has forecast -3.8% and the World Bank -3.1%.

“This is wholly expected, as more than 150 out of 195 countries in the world are projected to post negative growth this year.

“But what is most important is to ensure that a health crisis does not turn into an economic crisis.”

Tengku Zafrul added the FBM KLCI has also shown resilience relative to other countries as at end-June, 2020.

“Within Asean emerging markets, we are the best performing. Furthermore, as at end of trading yesterday, the FBM KLCI is close to recouping over RM200 billion in market capitalisation, taking the market cap back to levels seen at the start of the year.”