KUALA LUMPUR: The Malaysian economy is now on the path to recovery and is projected to chart better growth for 2021 despite the daunting challenges posted by Covid-19, said Senior Minister cum International Trade and Industry Minister Datuk Seri Mohamed Azmin Ali.
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Azmin said while Malaysia had been adversely affected by a global recessionary environment in 2020, the prospects for an economic upswing were far brighter this year.
This is due to an uptake in global demand, increased public and private sector expenditure as well as continued policy support,
“This (brighter prospect) will also be reflected in the recovery in labour market conditions and higher production in the manufacturing sector, particularly in the electrical and electronics (E&E), and the oil and gas facilities,” Azmin said at the Malaysian Economic Summit 2021 webinar today.
His speech was read by its deputy minister Datuk Lim Ban Hong.
Azmin believes that enhancement of productivity and economic growth will be further underpinned by an improvement in the global technology upcycle, and policy support from various fiscal and monetary measures including the additional economic stimulus packages.
“This positive outlook is reinforced by the most recent forecast by the World Bank, which projected the Malaysian economy to grow by 4.5 per cent in 2021, albeit revised down from our own more robust Bank Negara projections,” he said.
Azmin said Malaysia’s economic fundamentals remained resilient even during the difficult times, underpinned by the country’s broad-based economic structure which lent strength to its competitiveness.
He said for example, even for 2020, Malaysia was ranked 12th in the World Bank’s Ease of Doing Business Ranking and 27th in the IMD World Competitiveness Ranking and was ranked 4th among 17 economies as a manufacturing hub.
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“This is significant because our services and manufacturing sectors account for 58 per cent and 23 per cent of the economy respectively, while the commodity sector accounts for 14 per cent, which reflects the increasing sophistication, depth and complexity of the Malaysian economy,” he said.
Azmin said with its participation in the Regional Comprehensive Economic Partnership (RCEP), the world’s largest trading bloc, Malaysia could tap into 30 per cent of the world’s population as well as 30 per cent of the global gross domestic product (GDP) of US$ 26.2 trillion.
“Malaysia can also look forward to the reduction in tariffs and bureaucratic red tape as well as the unification of rules of origins which will facilitate international trade in greater coherence,” he said.
Azmin said Malaysia had formulated five National Investment Aspirations to serve as a framework to reinvigorate the national investment landscape as well as enhance long-term competitiveness.
In this regard, he said Malaysia aimed to increase economic complexity by ensuring that the country’s economy was increasingly built on skills-based industries, with significant production capabilities to create high-value products and services.
“We seek to create higher-value job opportunities for Malaysians to ensure that our people are equipped with sufficient skills required for the future.
“We also intend to extend our domestic linkages through integration with the regional economy, and empower more local businesses to better participate in the global value chain,” he said.
Azmin said Malaysia aimed to develop new and existing clusters that play a fundamental role in driving economic spill-overs which are the key to delivering holistic ecosystem benefits.-NST