KUALA LUMPUR, In 2022, Malaysia’s economy recovers steadily, thanks to improved labour conditions, increasing trade with foreign countries, etc. However, according to some research agencies, Malaysia faces such challenges as a sluggish economy and weaker exports in 2023.
The Bank Negara Malaysia, Malaysia’s central bank, said, the Malaysian economy expanded by 9.3 percent in the first three quarters of 2022. It projected the overall GDP growth will be between 6.5 percent and seven percent for the year, compared with 3.1 percent for 2021.
In Sept, the World Bank raised Malaysia’s 2022 economic growth forecast to 6.4 percent from 5.5 percent. The World Bank said in its report, Malaysia’s economic growth will be supported by strong domestic demand, which is underpinned by continued improvements in labour market conditions and tourism-related activities, by domestic and international travellers.
In terms of foreign trade, statistics from the Ministry of International Trade and Industry showed that, for the period of Jan to Nov, 2022, trade expanded by 29.9 percent compared to the same period last year. Exports increased by 27.2 percent, imports rose by 33.3 percent, and trade surplus edged up by 2.6 percent.
On the other hand, due to the spillover effects of the U.S. Fed raising interest rates, Malaysia suffered from high inflation. In the third quarter, the inflation rate was 4.5 percent. In Sept, the ringgit slid against the U.S. dollar, breaching the all-time low that was recorded during the Asian Financial Crisis period in 1998.
Looking ahead, several research agencies worry that an expected world economic slowdown and weaker global demand will bring challenges to the recovery of the economy in 2023.
A recent statement of S&P Global Market Intelligence showed, the seasonally adjusted S&P Global Malaysia Manufacturing Purchasing Managers’ Index (PMI) posted at 47.9 in Nov, down from 48.7 in Oct.
According to Malaysia’s central bank, the country’s economy is expected to expand by four percent to five percent in 2023.
Analysts pointed out that, China is an important trading partner of Malaysia, and China-Malaysian economic and trade cooperation will continue to play an important role in the development and transformation of the Malaysian economy.
The Malaysian Investment Development Authority showed, for the first three quarters of 2022, Malaysia attracted approved foreign direct investments of 130.7 billion ringgit (29.7 billion U.S. dollars), among which China dominated with 49.2 billion ringgit (11.17 billion dollars).
Malaysian Transport Minister, Anthony Loke Siew Fook, recently said that, Malaysia looks forward to further strengthening economic cooperation with China. Chinese enterprises contribute a lot to the economic and trade prosperity between Malaysia and China. Under the Belt and Road Initiative, a large number of high-end and cutting-edge Chinese enterprises entered Malaysia, injecting vitality and hope into the prosperity and development of Malaysia.
He also said, Malaysia encourages and welcomes more high-tech, energy-saving and eco-friendly Chinese enterprises to come to Malaysia, to help with industrial transformation and upgrading. It is expected that Chinese enterprises will make more contributions to Malaysia’s economic development in terms of technology transfer and job creation.
Source: Nam News Network