KUALA LUMPUR — Jan. 4, 2018: The overall outlook for Malaysia this year seems positive, with its gross domestic product (GDP) growth is expected to moderate at 5.5 per cent following a stellar economic recovery last year.
According to Second Finance Minister Datuk Seri Johari Abdul Ghani, the country’s economic conditions should remain conducive to support a more robust macroeconomic performance despite the fiscal deficit which was set to be reduced to 2.8 per cent from three last year.
“The GDP growth in 2018 shall continue to be driven by private consumption and investments, growth in exports and higher government spending in infrastructure projects — the East Coast Rail Link, High-Speed Rail, Mass Rapid Transit line two and Light Rail Transit line three,” he said in a keynote address at the CIMB Group Holdings 10th annual Malaysia Corporate Day today.
But while the overall outlook seems positive, the government is mindful of the external challenges.
The anticipated slowdown in China’s economic growth and rising geopolitical tensions in the Middle East, North Asia, as well as the current US foreign policies are likely to present a risk to the global economy as a whole, which will directly have a bearing on Malaysia as an open economy.
Moving forward, to ensure that Malaysia’s economy is more resilient against emerging mega-trends, the minister said the country needs to seriously embrace digital economy as one of the new core pillars to support the existing economic pillars that it had successfully built over the years.
“It is an open secret now that Malaysia seeks to become a prominent player in this new economy. We are taking this stance not because all other nations are shifting their focus to new technology and the 4th industrial revolution, instead because we can see the merits in embracing the digital economy to further unleash our potential growth.
“For example, in recent times, our digital economy has grown many folds and its contribution to our GDP is approaching the 20 per cent target for 2020.”
On the digital currency, Johari applauded Bank Negara Malaysia’s move to include digital currency exchanges within the ambit of anti-money laundering as a mean to manage the risk of digital currencies, as opposed to imposing a blanket ban on digital currency trading.
“I find this move rather refreshing. It demonstrates our ability to strike the right balance in our regulations, between promoting innovation and managing the associated risk to our financial system,” he said. — Bernama