KUALA LUMPUR (May 17): The government is optimistic that Malaysia’s gross domestic product (GDP) is well placed to expand within the official forecast range of 4% to 5% in 2024, driven by higher-than-expected growth in the first quarter of 2024 (1Q2024).
In a statement on Friday, the Ministry of Finance (MOF) said Malaysia’s economy, powered up by improvements in export performance and a revitalised domestic demand, expanded at a higher rate of 4.2% in 1Q2024 (4Q2023: 2.9%), exceeding the Bloomberg consensus forecast of 3.9%.
Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim said the domestic economy’s encouraging performance in 1Q2024 indicates that the government’s policies and economic management are effective in promoting growth.
“In spite of the turbulent global economy, Malaysia’s economy has performed strongly. Within the first full year in office, the government initiated a full set of policy reforms, and remains committed to our reform agenda to transform the economy and public delivery," he said in the statement.
Anwar said the government is committed to policy implementation set forth in the Madani Economy framework in the months and years ahead.
He said the optimism springing in the domestic capital market, exemplified by the FBM KLCI etching new highs, reflects global investors’ renewed interest in Malaysia’s reform narrative.
The MOF said that reflecting the favourable economic fundamentals in 1Q2024, total employment rose by 2.1% to 16.4 million people. Over 50,000 new jobs were created, contributing to a low unemployment rate of 3.3%.
Growth in salaries and wages also remained encouraging at 3.3% in the services sector, and 1.2% in manufacturing.
The ministry also noted that inflation remained benign at 1.7%, and the industrial production index rose by 3.3%.
On the external front, Malaysia’s total trade grew by 7.1% to reach RM690.6 billion in 1Q2024.
The MOF said the Madani Economy framework, which mapped out fresh strategies for Malaysia’s economic growth and identified new growth industries, had started to bear positive results evidenced by the economy’s continuing expansion.
“This is further catalysed by economic measures outlined in Budget 2024, and the government’s commitment to introducing responsible fiscal management while ensuring that the welfare of vulnerable communities is protected,” it said.
In addition, the implementation of strategies and measures under the National Energy Transition Roadmap, New Industrial Master Plan 2030 as well as the ongoing 12th Malaysia Plan would continue to attract quality investments in high value-added industries, the ministry said.
This would create high-income jobs and enhance the quality of living of the rakyat, it said.
“Moving forward, efforts are being made to further strengthen public service delivery as well as increase productivity. This is to ensure that pro-economic growth policies are executed as planned to achieve the nation’s aspirations,” the MOF added.