Economic Views

On October 13, 2023, the Malaysian government tabled its Budget for 2024, the largest on record with an allocation of RM393.8 billion (Budget 2023: RM388.1 billion), albeit slightly lower than the spending amount for 2023 estimated at RM397.1 billion. The government has allocated for a higher operating expenditure of RM303.8 billion (2023 estimate: RM300.1 billion), …

Budget 2024: Reforms on the horizon, further fiscal consolidation would be beneficial Read More »

Malaysia continues to maintain its policy commitment to worker welfare, through its ongoing review of wage policies. In July 2023, Malaysia increased the minimum wage from RM1,200 to RM1,500, extending its applicability to micro-enterprises with a staff size of less than five. The minimum wage of RM1,500 was already in effect since May 2022 for …

Recommendations on Malaysia’s ongoing development of wage policies Read More »

Malaysia continues to maintain its long-term commitment of fiscal consolidation to enhance debt sustainability. In terms of the government’s fiscal balance, this has remained largely stable, excluding during the pandemic period. Over the 10-year period from 2013 to 2022, Malaysia’s fiscal deficit averaged 4.2% of gross domestic product (GDP). Excluding the COVID-19 fund, Malaysia’s fiscal …

GST and other potential anchors to enhance Malaysia’s fiscal position Read More »

Global economic growth is expected to slow down from 3.4% in 2022 to 2.6% in 2023 against the backdrop of monetary policy tightening in advanced economies. While supply chain normalisation should support the recovery, economic momentum in advanced economies will likely remain uneven. The impact of an extended period of rate hikes in the US …

Asia a source of stability amid rising uncertainties Read More »

On July 27 2023, the Malaysian government launched the visionary MADANI economic narrative, a roadmap to pave the way for sustainable growth. The framework will guide Malaysia’s mission of socioeconomic as well as overarching strategic and tactical plans. From the economic perspective, the MADANI framework is timely in view of the upcoming Budget 2024, New …

Malaysia launches visionary MADANI economic narrative Read More »

The sharp weakening in Malaysia’s ringgit has reached an unprecedented low based on its Real Effective Exchange Rate (REER) according to data from the Bank of International Settlements (BIS). The REER is a measure of the exchange rate value weighted by trade and adjusted for inflation. On one hand, it explains that exports from Malaysia …

Ringgit weakness reflects Malaysia’s economic vulnerability Read More »