KUALA LUMPUR (March 24): Malaysia’s current account surplus in the balance of payment is expected to continue to expand in 2025, since the 26-year low in 2023, thanks to exports and tourism activity.

Current account surplus — a measure of how much more foreign currency a country receives than it spends — may rise to RM41 billion in 2025, from RM32.8 billion in 2024, the central bank’s Economic and Monetary Review (EMR) 2024 report issued on Monday showed.  

As a percentage of gross domestic product (GDP), the surplus will widen to 1.5%-2.5% this year, from 1.7% in 2024, thanks to sustained goods surplus amid a lower deficit in the services account.

The goods account is projected to record a surplus of RM118.9 billion in 2025, versus RM117.1 billion in 2024, with expectations of exports continuing to exceed imports, Bank Negara Malaysia (BNM) said.

Meanwhile, the central bank said the services account is expected to post a narrower deficit of RM8.1 billion this year, versus RM13.9 billion in 2024, supported by a higher surplus in the travel account, as tourist arrivals and receipts in 2025 are projected to grow further and exceed pre-pandemic levels.

“The primary income account is projected to remain in deficit (-RM59.3 billion, 2024: -RM61.5 billion). This is driven by the continued income payment accrued to foreign investors in Malaysia, amid improving export earnings,” BNM said.

“Similarly, the secondary income account is expected to remain in deficit (-RM10.5 billion, 2024: -RM8.9 billion), due mainly to higher outward remittances by foreign workers. Nevertheless, this is expected to be partly cushioned by higher inward remittances from Malaysians working abroad,” it also noted.

Malaysia has had an uninterrupted current account surplus in its balance of payment since the Asian financial crisis nearly three decades ago. 

However, the surplus more than halved back in 2023 to RM22.8 billion or 1.2% of gross domestic product (GDP) — its lowest since 1997,  amid sluggish external demand, the global technology downcycle, and lower commodity prices.

The country’s current account surplus has since bounced back to expanding. In BNM’s 2023 EMR, the central bank projected a current account surplus of RM41.5 billion or 1.8%-2.8% of GDP for 2024.

Click here to read more stories on BNM Annual Report 2024.