Kuala Lumpur (VNA) – Malaysia’s economy is projected to expand more strongly than expected in the fourth quarter of 2025, growing by 5.7%, according to estimates released by the Department of Statistics Malaysia.
The benchmark index of Bursa Malaysia has also surpassed the 1,700-point mark, recording its strongest performance since February 2019.
Dr Irwan Shah Zainal Abidin, senior researcher at the Economic and Financial Policy Institute (ECOFI) of Universiti Utara Malaysia, said the positive data reflects improved sentiment and growing confidence in the country’s economic performance and management, which has gained momentum since the Madani economic framework was introduced in 2023.
In the first half of 2025, the New Industrial Master Plan 2030 (NIMP 2030) attracted 29.2 billion MYR (7.44 billion USD) in investments, supporting 178 high-value projects and creating 17,056 jobs. The plan focuses on attracting quality investments to generate higher-income employment.
Malaysia’s approved investments reached 285.2 billion MYR (72.65 billion USD) in the first nine months of 2025, one of the highest levels recorded. The country’s total trade also hit a record 3 trillion MYR (764 billion USD) in 2025. Supported by strong economic fundamentals, full-year GDP growth is expected to exceed earlier projections, reaching about 4.9%.
The unemployment rate stood at 2.9% in November, the lowest level in 11 years. The government has also maintained fiscal discipline, targeting budget deficit below 3% and keeping government debt-to-GDP ratio at under 60% of GDP by 2030.
Stable inflation is expected to support business activity and consumer confidence in the coming period. A low inflation environment will also provide Bank Negara Malaysia with greater flexibility in adjusting monetary policy, particularly as the US Federal Reserve is entering a rate-cut cycle and is expected to adopt a more accommodative stance in the coming months.
Improved competitiveness rankings, political stability and a clear economic direction helped the ringgit become Asia’s best-performing currency in 2025, strengthening by 9.7% against the USD.
The Malaysian government is also implementing several initiatives to sustain growth, including the Government-Linked Enterprise Activation and Reform Programme (GEAR-uP), which is expected to mobilise 120 billion MYR (30.5 billion USD) in domestic investments by 2028.
Another key initiative under the 2026 budget is Visit Malaysia Year 2026, which aims to attract 47 million tourists and generate tourism revenue of 329 billion MYR (83.8 billion USD), with the consumer and services sectors expected to play a central role./.
