Dato Sri Wong Soon Koh
KUCHING: The state economy is projected to grow by five per cent this year, following strong growth stimulated by both domestic and external demands.
The growth is also driven by continued expansion of domestic consumption and investment as well as sustained favourable commodity prices and exports; reported Second Finance Minister Dato Sri Wong Soon Koh when delivering his winding up speech at the State Legislative Assembly (DUN) sitting today.
Wong (BN-Bawang Assan) added that performances for all the supply sides were projected to be positive for 2011.
“The services sector is expected to expand by 6.2 per cent this year, driven by domestic demand for wholesale and retail trade, as well as utilities. Moderate growth in the trade related sub-sector such as transport and storage was expected, reflecting slower expected growth of external demand.
“Continued efforts to attract more visitors to the State through MICE and tourism activities will further support growth in the accommodation and restaurant sub-sectors,” he stated.
The services sector registered a higher growth of 7.1 per cent in 2010, with robust growth across all sub-sectors. The wholesale and retail trade sub-sector registered a strong growth of 10 per cent while transport, storage and communication sub-sectors grew by six per cent.
Cargo-related activities at major ports grew by 6.9 per cent while air transport segment gained as passengers volume for all principal airports statewide rose by 3.9 per cent.
In addition, the manufacturing sector is anticipated to grow by 4.4 per cent in 2011 as demand for the State’s resource-based sub-sectors was expected to remain robust from economies in the region. In 2010, the manufacturing sector grew by 5.4 per cent driven by demands for the liquefied natural gas (LNG) and timber products.
As for the construction sector, 2011 would see an anticipation of 5.5 per cent growth with commencement under the 10th Malaysia Plan; and the implementation of multitude of infrastructure projects under the National Key Result Areas (NKRA) and in the Sarawak Corridor Of Renewable Energy (SCORE) area.
In agriculture, Wong mentioned that the sector was anticipated to grow at 4.4 per cent due to favourable global demand and rebound in commodity prices in 2010. This added with the increase production of crude palm oil which grew by 9.2 per cent during the year due to increase mature areas and improvement in yields.
“The mining and quarrying sector is expected to grow by three per cent in 2011 as the production of natural gas is anticipated to increase to meet demand particularly from our traditional markets such as Japan and Korea.
“The sector grew by 3.2 per cent in 2010 with increased production of natural gas, coal and silica sand. The production of natural gas grew by 17.4 per cent arising from increased demand from domestic petro-chemical industries and major importing countries.”
Meanwhile, on the demand side of the state economy, public consumption expanded by 2.5 per cent last year, is estimated to grow by 2.9 per cent in 2011. Private consumption grew strongly at 6.3 per cent in 2010 and indicators have shown that households loans increased by 17.1 per cent while the sales of passenger vehicles and consumption of imported goods increased by 6.1 per cent and 7.9 per cent respectively.
The year 2011 would see projection of private consumption set to increase remarkably by 7.2 per cent with continued improvement in the labour markets, disposable incomes and consumer confidence. Employment prospect would remain positive with stronger labour demand across various sectors as economic activities gain further momentum.
Investment in the State was also expected to increase in both the private and public investment. The public investment in the State was expected to increase by 5.5 per cent for 2011, with the implementation of development projects under the 10th Malaysia Plan, SCORE, NKRA as well as entry points projects identified under the Economic Transformation Programme.
Private investments is expected to grow at 9.1 per cent, supported by capital spending in all economic sectors particularly in the services, manufacturing as well as construction.
Highlighting on external trade, Wong mentioned that based on the first quarter of 2011, exports grew by 8.1 per cent as a result of higher commodity prices particularly for agriculture and minerals. Gross exports are expected to expand at a more moderate pace in tandem with the projected moderation of global growth.
Total revenue collected by the state amounted to RM5.607 billion in 2010, an increase of 22.9 per cent as compared to RM4.563 billion the previous year. As of the first quarter of 2011, revenue collection so far has reached RM1.866 billion.