Finance Minister Datuk Seri Tengku Zafrul has declared that Budget 2021 will be an expansionary budget.  

What would an expansionary budget in the midst of a pandemic entail?  

Here are the insights from bankers from different segments of the banking business on this.

What could an expansionary budget entail?  

Budget 2020, which was announced last Friday (Oct 11) by Finance Minister Lim Guan Eng, has spurred various reactions from brokers.

"Unlike its austerity sounding predecessor, Budget 2020 certainly heard a change of tone," Hong Leong Investment Bank Research analysts said.

What equity strategists think about Budget 2020

The Government's economic growth projection of 4.8% in 2020 — slightly more than the estimated 4.7% in 2019 — may be a bit too ambitious, compared with the market consensus of 4.3% in 2020.

For OCBC Bank chief economist Selena Ling, even with the Government's overt efforts in Budget 2020 to prop up private consumption — which is an important part of the economy at close to 60% of the total Gross Domestic Product (GDP) by expenditure — she still thinks the overall growth target might be hard to reach.

Govt's GDP growth projection of 4.8% in 2020 may be too ambitious, say economists

Malaysia's Budget 2020 represents a prudent balance between the competing needs for Malaysia to preserve fiscal sustainability, while also responding to the realities of a slowing economic environment, said the World Bank's lead economist for Malaysia, Richard Record.

"We welcome the emphasis on measures to boost jobs and private investment, particularly by SMEs through increased digital adoption. Proposals to reform Malaysia’s investment incentives framework, focusing particularly on job creation and SME linkages as well as enhanced monitoring and evaluation, are an important step in the right direction," Record said in a statement

Malaysia's Budget 2020 strikes a prudent balance — World Bank

Budget 2020 is a testament to the fact that the Federal Government is committed to narrowing development between the peninsula and East Malaysia, said Works Minister Baru Bian.

“This is an improvement from the 2019 allocation Budget, I believe it has to be done in the capacity of the government of the day, you have to be reasonable, and at the same time we have to be responsible,” he told reporters after the tabling of Budget 2020 today

Budget 2020 shows Putrajaya pays attention to Sabah and Sarawak, Baru Bian says

KUALA LUMPUR (Oct 11): The expanded Budget 2020 may put the government’s original 3% deficit target for next year further out of reach, against a projected decline in revenues, said Moody’s Investors Service.

“Fiscal strength will continue to constrain Malaysia’s credit profile, although the focus on some inclusive growth measures will be credit positive for the country if sustained over time,” said its vice-president — senior analyst, sovereign risk group, Anushka Shah.

Expanded budget pushes govt’s 3% deficit goal further out of reach — Moody’s

KUALA LUMPUR (Oct 11): Audit firms lauded the measures announced in Budget 2020 as the budget is seen to be focused on driving growth for the long term, amid the current uncertain global environment.

Pricewaterhouse Coopers Malaysia tax leader Jagdev Singh pointed out that this is the first budget that provides some clarity on the nation’s approach in navigating the digital and high-technology economy.

Budget 2020: A growth-driven, long-term budget, say audit firms

The Malaysian Employers Federation (MEF) has raised concerns over the Government’s proposal to increase minimum wage in cities and major towns to RM1,200 a month from RM1,100 at present.

MEF also said that the proposals to increase maternity leave and extend eligibility of overtime to a bigger employee group would “further add to the cost of doing business”.

MEF raises concerns on minimum wage hike, Employees Act review

Further details about the Johor Bahru-Singapore Rapid transit System project will be revealed "within the next few weeks", said Transport Minister Anthony Loke.

“The Finance Minister has indicated that the Government is supportive of the project. We are now in the midst of discussions. I will make an announcement on the RTS very soon, within the next few weeks, because the extension of the suspension of the agreement is until Oct 31 this year,” he told reporters at Parliament lobby today, following the tabling of Budget 2020.

More details on Johor-Singapore RTS to be revealed in weeks — Loke

The proposal by the Government to merge Malaysia's development financial institutions (DFI) will lead to greater synergies, as well as fulfilling the needs of the new economy, according to Bank Pembangunan Malaysia Bhd (BPMB).

In a statement following the Budget 2020 announcement today, BPMB said the proposal is a "positive development" in the Government's efforts to strengthen the DFI eco-system

DFI merger will lead to greater synergies, says Bank Pembangunan

Several property-related measures were announced during the tabling of Budget 2020 by Finance Minister Lim Guan Eng, including adjustments to the real property gains tax (RPGT) and the lowering of the threshold for foreign buyers of high rise properties, as well as the introduction of a Rent-to-Own (RTO) scheme for first-time buyers.

Here’s what property developers think of the Budget measures

What property players are saying about the Budget

KUALA LUMPUR (Oct 11): The Armed Forces Fund Board (LTAT) has welcomed the 12% increment in the allocation for the Ministry of Defence to RM15.6 billion in Budget 2020, from RM13.9 billion in Budget 2019.

“This increment bodes well for us, given that it provides opportunities to companies under the current LTAT stable that are key participants in the maritime sector, with current projects with the Ministry,” the board’s chief executive Nik Amlizan Mohamed said in a statement.

LTAT pleased with increased budget allocation to Mindef

KUALA LUMPUR (Oct 11): The government’s Budget 2020 continues to allocate the largest amount to the Ministry of Education — increasing its allocation by 6.5% to RM64.1 billlion from RM60.2 billion this year.

Of this, the portion for school maintenance and upgrading works is also higher at RM735 million, from RM652 million last year.

Education ministry gets biggest chunk at RM64.1b

The Government is proposing to give wage and hiring incentives to employees and employers in a bid to address the high youth unemployment rate in the country, and to reduce the country’s over-dependence on low-skilled foreign workers.

Putrajaya proposes to spend RM6.5 billion across five years in an initiative called “Malaysian@Work”, Minister of Finance Lim Guan Eng announced in Budget 2020 today.

Incentives for employers, workers in bid to address employment woes

Sime Darby Property Bhd (KL:SIMEPROP) is integrating the solar-powered landed homes at its Elmina Ridge development in City of Elmina, Shah Alam, with the battery energy storage system (BESS).

Sime Darby Property integrates solar-powered Elmina Ridge landed homes with battery energy storage system

Health Minister Datuk Seri Dr Dzulkefly Ahmad said his ministry is set to award additional pharmaceutical procurement contracts early next year to ensure a steady supply of medication in the country, particularly human insulin.

MOH to award new contracts early 2025, ensure steady medication supply, particularly human insulin

Lawyer for former prime minister Datuk Seri Najib Razak, Tan Sri Muhammad Shafee Abdullah, said he has a suspicion fugitive Low Taek Jho, or Jho Low, is currently residing in Myanmar under the protection of the military junta there.

Najib’s lawyer believes Jho Low is in Myanmar

Construction services firm TCS Group Holdings Bhd (KL:TCS) has secured a contract worth RM611.3 million, about seven times its market capitalisation of RM90.9 million, to build a new highway and to upgrade roads under Phase 1B of the Pan Borneo Highway.

TCS Group bags RM611.3 mil job under Pan Borneo Highway

Auto parts maker APM Automotive Holdings Bhd (KL:APM) posted a 27.94% drop in net profit for the third quarter on foreign exchange losses.

APM Automotive’s 3Q net profit down 28% on forex loss

Frozen food distributor Supreme Consolidated Resources Bhd (KL:SUPREME), which is heading for a listing on the ACE Market on Nov 29, had its public issuance of 8.6 million new shares oversubscribed by 349.42 times.

Frozen food distributor Supreme Consolidated's 8.6 mil shares for public oversubscribed by 349 times

Chinese Foreign Minister Wang Yi said the country wants to restore direct flights with India, as tensions between the two Asian neighbours dial down following a four-year impasse on border disputes.

China seeks to resume direct flights with India as tensions ease

Asian News International, one of India’s largest news agencies, sued OpenAI in a court in India alleging that the US artificial intelligence company misused its copyrighted news content.

Indian news agency sues OpenAI for copyrighted content violation

Options traders are primed for a nearly US$300-billion (RM1.34-trillion) swing in Nvidia's market value following the chipmaker's quarterly results on Wednesday, US options market data showed.

Nvidia's options primed for US$300b price swing after earnings

Theta Edge Bhd (KL:THETA) signed a memorandum of understanding (MOU) with China’s ZICT Technology Co Ltd today (Nov 19), laying the groundwork for collaboration in smart city development and mobility-as-a-service (MaaS) initiatives.

Theta Edge enters pact with ZICT Technology for smart city solutions

An estimated 620,000 jobs across 10 key sectors of the Malaysian economy are at risk of convergence of displacement if they do not reskill or pivot to an adjacent role, based on a study on the impact of artificial intelligence (AI), digital technology, and the green economy on the Malaysian workforce.

620,000 Malaysian jobs across 10 sectors at high risk of displacement by advancement of AI, digital tech and green economy, says TalentCorp study

Apple Inc has increased its offer to invest in Indonesia by almost tenfold, according to people familiar with the matter, in the US tech giant’s latest bid to persuade the government to lift its sales ban on the iPhone 16.

Apple offers US$100m to undo Indonesia iPhone 16 ban

THE share price of Johor-based dairy product specialist Farm Fresh Bhd (KL:FFB) plummeted to a low of RM1.06 in July last year — a sharp drop of 21% from its March 2022 initial public offering (IPO) price of RM1.35.

At the time, investor sentiment was shaken by reports of supply constra...

Farm Fresh hits record high — will the stock keep climbing?

Newly confirmed High Court judge Leong Wai Hong has recused himself from hearing 1Malaysia Development Bhd (1MDB) and 10 other companies' US$346 million (RM1.63 billion) suit against Datin Seri Rosmah Mansor and Singaporean Shabnam Naraindas Daswani.

Rosmah successful in recusing judge from hearing 1MDB suit against her and Singaporean

(Nov 19):&nbsp;Marina Bay Sands is seeking a loan of around S$12 billion (US$9 billion, or RM40.24 billion), in what would be the largest financing from Singapore, as the company looks to fund the planned expansion of its casino resort in the city state.&nbsp;

Marina Bay Sands eyes Singapore’s largest loan of US$9b — Bloomberg

KUALA LUMPUR (Nov 19): The widow of Tun Daim Zainuddin on Tuesday insisted that the criminal charge against him go for a full trial, confident that he will be exonerated.

Daim’s widow wants trial against her husband to proceed to clear his name

The transformation of the Armed Forces Fund Board (LTAT) must begin immediately as a prolonged suspension of the pension fund's activities risks liquidation of its assets, according to a report by the Public Accounts Committee.

Parliament watchdog flags RM5b risk amid LTAT-Boustead restructuring halt, calls for immediate action

SINGAPORE (Nov 18): Genting Singapore’s licence to operate a casino here has been renewed for two years with effect from next February.

Genting Singapore receives two-year extension of its casino licence

LAST Monday, Datasonic Group Bhd (KL:DSONIC) announced that it had bought 51% equity interest in Innov8tif Holdings Sdn Bhd for RM40 million in cash from Revenue Group Bhd (KL:REVENUE).

Innov8tif Holdings and its subsidiaries Innov8tif Solutions Sdn Bhd, Xendity Sdn Bhd and Innov8tif So...

The tale of Innov8tif and five public-listed companies

Emerging Asian stock markets rallied on Tuesday, with Bangkok and Manila trading higher on expectations of rate cuts in the near future, while Singapore stocks hit a 17-year high.

EM stocks rally; Manila, Bangkok up on rate-cut bets

KUALA LUMPUR (Nov 19): Home Minister Datuk Seri Saifuddin Nasution Ismail said on Tuesday that all immigration counters and automatic gate systems (autogates) at the Kuala Lumpur International Airport (KLIA), as well as at Bangunan Sultan Iskandar’s customs, immigration and quarantine (CIQ) complex in Johor Bahru, must remain open during peak hours to ease congestion.

All immigration counters, autogates at KLIA and Bangunan Sultan Iskandar to stay open during peak hours — home minister

Malaysia has raised its December export tax for crude palm oil to 10% from 8% and increased its reference price, a circular on the Malaysian Palm Oil Board website showed on Tuesday.

Malaysia raises December crude palm oil export duty to 10%

Donald Trump's social media company is in advanced talks to buy crypto trading firm Bakkt, the Financial Times reported on Monday, citing two people with knowledge of the talks.

Trump's social media group in talks to buy Bakkt — FT

PUTRAJAYA (Nov 19): Imprisoned former prime minister Datuk Seri Najib Razak’s appeal of his RM1.9 million malfeasance in public office suit against former attorney general (AG) Tan Sri Tommy Thomas has been vacated yet again.

Another COA judge recuses herself, Najib’s appeal in suit against Tommy Thomas postponed

Malaysia’s poultry players may see an expansion in their profit margins thanks to declining feed expenses and other input costs that will help soften the blow from the ringgit's depreciation, an analyst said.

Poultry sector may see profit margins expand on lower feed costs — MIDF

CelcomDigi Bhd’s (KL:CDB) short-term outlook may be subdued following an underwhelming third-quarter, though analysts are cautiously betting that earnings will accelerate in 2025.

CelcomDigi's short-term outlook tepid after underwhelming 3Q as analysts bet on 2025

Two of the world’s biggest foreign holders of US government debt offloaded a pile of treasuries in the third quarter as they rallied before the presidential election.

Japan and China dump US treasuries before Trump’s victory

Malaysia’s initial public offering (IPO) market continued to outperform its Southeast Asian peers so far this year, leading in terms of IPO count, funds raised and market capitalisation, according to Deloitte's latest report.

Malaysia's IPO market remains in the lead in Southeast Asia, with highest listings, funds raised, market cap — Deloitte

The Malaysian automotive sector could see sustained growth in 4Q2024 on high order backlogs and promotional activities, analysts said after a month-on-month (m-o-m) rebound in October sales.

Backlog to support 4Q auto sales, say analysts after October m-o-m rebound

The Ministry of Health (MOH) will no longer award pharmaceutical procurement contracts to just one company, in order to ensure a secure and stable supply of medication in the country.

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