GOOD GROWTH OVERALL: Economists are confident that Malaysia will continue to enjoy economic growth next year, bolstered by robust domestic demand and investment.
KUALA LUMPUR: Despite the unfriendly external environment, economists are confident that Malaysia will enjoy continued economic growth next year, bolstered by robust domestic demand and investment.
While some may expect a moderate growth compared with 2012, the expansion in domestic demand, supported by private sector spending is expected to offset weak export growth and help the country significantly reduce the budget deficit.
More inflow of income from the construction, tourism, services and, oil & gas sectors are also expected.
The country is moving towards achieving an economic growth of more than five per cent in 2013, after recording impressive Gross Domestic Product (GDP) growth of 4.7 per cent in the first quarter, 5.6 per cent in the second quarter and 5.2 per cent in the third quarter.
Malaysia’s economic growth projection for next year is pegged between 4.5 per cent and 5.5 per cent, albeit the challenging global economy.
Among those optimistic the target can be reached is RAM Holdings Bhd which is maintaining Malaysia’s GDP forecast at 5.3 per cent for next year given the positive double-digit growth in private investment in the first three quarters of 2012.
Group chief economist Dr Yeah Kim Leng said if the government could sustain private investment growth, which was more than 20 per cent in the first three quarters of 2012, then economic growth would likely be maintained at above five per cent next year.
“Our domestic demand growth strategy has to encourage and promote confidence in the private sector and create a business environment that encourages them to invest locally,” Yeah said.
JPMorgan Securities (Malaysia) Sdn Bhd, on the other hand, expects Malaysia’s GDP to grow at 5.2 per cent this year and 4.5 per cent in 2013, saying the country looked interesting from a regional point of view due to its defensiveness and domestic-led growth.