Malaysia’s economic growth to exceed 5% this year

The Federation of Malaysian Manufacturers (FMM) has revised the 2024 economic growth projection given the stronger-than-expected momentum in the second quarter (Q2).

Malaysia's economic growth will likely exceed the government’s 4% to 5% target range, says the Federation of Malaysian Manufacturers. (Photo: thestar.com.my)

The GDP growth will likely exceed the government’s 4-5% target with a revised 5.1%, FMM said in a statement on August 29. This adjustment comes from positive growth in private sector investment and consumer spending, reflecting the economy’s strong recovery trajectory.

Despite global uncertainties, FMM expected the economy to continue its positive growth trend throughout the rest of 2024.

The economy expanded by 5.9% in Q2, the highest quarterly growth since Q1 2017, compared to 4.2% in Q1, due to a strong export-led recovery, robust domestic demand, and a surge in tourist arrivals.

According to FMM, Malaysia’s economic growth has been driven by a robust export sector, with real export value up by 8.4% in Q2 thanks to strong demand for commodities, electronics, and petroleum products.

Although the Central Bank of Malaysia forecasts that inflation would be kept at 2.0 - 3.5%, FMM believes that inflation may increase in the second half of 2024. In addition, the ringgit has rebounded strongly against the US dollar, reaching an 18-month high, and is expected to maintain an appreciating trend in the coming months./.

VNA