Cautious MoF maintains 4.9pc GDP growth outlook, despite Nikkei's 5.2pc projection

Finance Minister Lim Guan Eng says that the Ministry of Finance will remain cautious and maintain its current growth projections for 2019. ― Picture by Miera Zulyana
Finance Minister Lim Guan Eng says that the Ministry of Finance will remain cautious and maintain its current growth projections for 2019. ― Picture by Miera Zulyana

KUALA LUMPUR, May 3 ― The Ministry of Finance (MoF) has maintained its current outlook on the nation's gross domestic product (GDP) growth at 4.9 per cent today, despite finance media outlet Nikkei's projection of a 5.2 per cent expansion yesterday.

Finance Minister Lim Guan Eng said in a statement that the ministry will remain cautious and maintain its current growth projections for 2019.

“The Ministry of Finance welcomes the latest Nikkei Manufacturing Purchasing Managers’ Index (PMI) reading for Malaysia, which rose to 49.4 points in April 2019 from 47.2 points in the previous month. This is the highest level recorded in 7 months,” said Lim.

“Nikkei in its PMI note wrote that the April 2019 reading indicated a 5.2 per cent expansion in this year’s GDP, which is higher than the 4.9 per cent growth projected by the Ministry.

“Nevertheless, the Ministry of Finance will remain cautious and maintain its current growth projection for this year,” he added.

Lim said that the April rise in PMI was contributed by an increase in export orders, employment growth, investment into new machines and plants, as well as improved business confidence built on policy clarity and certainty provided by the government’s reform agenda, among others.

The minister also added that the increase in new investment was a direct result of Putrajaya's success in growing Malaysia's approved foreign direct investment by 48 per cent to RM80.5 billion in 2018 from RM54.5 billion in 2017.

“The continuous sustainable growth proves that the current recovery and development initiatives carried out by the Pakatan Harapan administration are proceeding as planned.

“The government will continue its efforts to enhance the people’s welfare by focussing on achieving high-quality growth,” said Lim.

In its report yesterday, Nikkei had also said that the level of business confidence in April is the highest since October 2013.

Last month, the Malaysian Institute of Economic Research forecasted that Malaysia will post a moderate GDP growth of just 4.5 per cent compared with 4.7 per cent last year, due to slowdown in global economy.

Analysts Moody’s Investor Service also revised its GDP growth prediction fo 2019 and 2020 last month to merely 4.4 and 4.3 per cent respectively, down from initial figures of 4.7 and 4.5 per cent in January this year.

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