KUALA LUMPUR: The better-than-expected gross domestic product (GDP) growth in 2015 proves that the government’s financial and fiscal reforms have been successful, said an economist.
Affin Hwang Investment Bank Bhd’s Head of Retail Research, Datuk Dr Mohd Nazri Khan, said the economy, which was badly hit in the last quarter due to the plunging oil prices and weakening of ringgit, managed to beat consensus expectations.
“The financial and fiscal reforms that have been undertaken over the last year have been successful to ensure the economy is resilient to weather all of these external shocks. We must laud all the unpopular measures introduced by the government such as the Goods and Services Tax and subsidy rationalisation, as they have been successful to cushion the weaknesses that we’ve seen from the global uncertainties,” he told Bernama when contacted yesterday.
He said 2015 has been a tough year for Malaysia and it was not easy for the government to strike a delicate balance between public finance reforms to ensure that the country has a budget deficit target as well as continuous growth in the economy. The government aims to achieve a budget deficit of 3.1 per cent of GDP in 2016 from 3.2 per cent in 2015.
“Overall, I see it’s a good momentum, especially on the domestic front despite challenging economic uncertainties,” Nazri said.
Earlier, Bank Negara Malaysia had announced that Malaysia’s economy grew by 4.5 per cent in the final quarter (Q4) of 2015, bringing the full-year GDP growth to five per cent as against six per cent in 2014.
This was supported mainly by private sector demand, while on the supply side, it was underpinned by the major economic sectors.
The country had recorded a GDP growth of 5.6 per cent in the first quarter before slowing down to 4.9 per cent in the second quarteer and 4.7 per cent in the third. — Bernama