Hanoi (VNA) – Malaysia will not face an economic recession this year as the country recorded an impressive 5.6% gross domestic product (GDP) growth in the first quarter of 2023, according to the country's central bank governor Tan Sri Nor Shamsiah Mohd Yunus.
Mohd Uzir Mahidin, director of the Department of Statistics Malaysia, attributed the positive economic growth in the first quarter of this year to an improvement in household spending, direct investment, the labour market, and tourism. Specifically, the service industry grew by 7.3% in the period while the manufacturing, construction and agricultural sectors rose by 3.2%, 7.4% and 0.9%, respectively.
Malaysia recorded 12 billion RM (2.6 billion USD) in foreign direct investment (FDI) at the end of the first quarter. This investment was mainly in the financial, mining, and manufacturing sectors.
Inflation is forecast to remain high at 2.8-3.8% this year. It stood at 3.9% in the first quarter of this year, showing that even when costs have been reduced, vibrant economic activity still creates pressure that spurs consumer demand and causes inflation to soar.
Despite the challenges that the economy is facing, Shamisah affirmed that the Malaysian economy is on track to achieve GDP growth of 4-5% thanks positive signal of domestic demand, adding that the risk of high inflation mainly comes from domestic factors such as tourism activities and the implementation of large infrastructure construction projects.
Malaysia’s Finance Minister Datuk Seri Anwar Ibrahim agreed, saying that to this end, the government will prioritise solving the economic challenges that Malaysians have to deal with, especially combating wastefulness and corruption./.
