Malaysia’s economic growth has been impressive in the current context of the turmoil in global markets, said MIDF Amanah Investment Bank Bhd Head of Research Zulkifli Hamzah.
He said although prices of commodities, such as oil, have tumbled, Malaysia has succeeded in generating growth, creating job opportunities and improving the standard of living.
“The devaluation of the Ringgit, although viewed negatively by the people, has benefited the export-oriented industries, especially the resource-based ones.
“The most important thing now is to retain our growth momentum. Despite the challenges Malaysia has been facing, its growth momentum last year was better than Singapore’s,” he told Bernama here, Tuesday.
Zulkifli was commenting on a Bloomberg report yesterday which forecast a Gross Domestic Product (GDP) growth of 4.5 per cent for Malaysia in 2016.
Malaysia’s GDP growth this year is expected to be the 13th highest in the world, and it has a 10 per cent chance of recession, according to Bloomberg.
Moody’s Investors Service, meanwhile, has affirmed the Government of Malaysia’s issuer and senior unsecured bond ratings at A3 and changed the outlook to stable from positive.
On the rationale for the affirmation of the A3 rating, Moody’s said yesterday Malaysia has weathered the stresses of the past year with many of its fundamentals largely intact.
The international rating agency said it also expects Malaysia to continue to grow faster than other A-rated countries this year and over the medium term.
Zulkifli said sentiment towards the country, in general, has improved compared with the situation last year.
“Things are more stable this year,” he said.
Meanwhile, UMNO Youth Professional Bureau Chairman Shahril Hamdan said the Bloomberg report showed that Malaysia’s economic fundamentals were still strong enough to chart further growth.
He said the projected growth of 4.5 per cent was quite high, against the World Bank estimate of a 2.9 per cent growth for the global economy.
“It’s reflective of the government’s sound macro-economic steering. Despite the challenges posed by the falling oil prices and slower growth in China, Malaysia’s economy is still being seen as stable compared with other developed Asian nations like Japan, Taiwan and South Korea, which face a higher chance of falling into recession than Malaysia.
“However, the real challenge for our government is steering its micro-economy, that is the economic situation confronting the people of this country. Not only is the cost of living on the rise, some companies are reducing their workforce through the VSS (voluntary separation scheme) as they are forced to restructure their operations in view of the trying economic climate,” he told Bernama.
Shahril said the government should continue with its efforts to take care of the welfare of the people and improve competitiveness through the implementation of various schemes and programmes.
“The 1Malaysia Training Scheme is a good example of a programme which can enhance graduates’ employability. Any recalibration of Budget 2016 should take these matters into account,” he said.