Stats Dept foresees healthier economic growth for Malaysia in coming months

According to the Department of Statistics Malaysia, the country’s economy is expected to improve in the upcoming months. — Picture by Firdaus Latif
According to the Department of Statistics Malaysia, the country’s economy is expected to improve in the upcoming months. — Picture by Firdaus Latif

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KUALA LUMPUR, Nov 26 ― Malaysia’s economy is expected to improve in the upcoming months despite setbacks from the previous quarter of 2021 due to the implementation of movement control order (MCO) in bid to cushion the spread of Covid-19 infections.

In the latest Malaysian Economic Statistics Review (MESR), Department of Statistics Malaysia (DoSM) chief statistician Datuk Seri Mohd Uzir Mahidin said that together with further resumption as the country’s transition to National Recovery Plan (NRP) continues, businesses has started to gain confidence in the market after recording -0.3 per cent in confidence indicator as compared to -21.3 per cent in the previous quarter.

“This could signal a strong recovery momentum towards the fourth quarter of the year and into 2022 where Malaysia’s GDP (gross domestic product) is set to be on track to meet the three to four per cent forecast growth, supported by the high vaccination rate of Malaysian population, continued policy support and strong external demands,” he said.

The latest report mentioned that the country’s GDP contracted 4.5 per cent in the third quarter despite recording positive growth of 16.1 per cent in the second quarter of 2021.

However, it stated that the country’s economy grew by three per cent in the first nine months of 2021 as compared to a contraction of 6.4 per in the same period last year.

“The performance in terms of supply was influenced by the decline in all key sectors of the economy, particularly in the services sector which shrank by 4.9 per cent in this quarter from a growth of 13.5 per cent and the manufacturing sector which registered a marginal decline of 0.8 per cent as compared to a growth of 26.6 per cent in the previous quarter,” he added.

Mohd Uzir said Malaysia’s current account balance recorded a surplus registering RM11.6 billion in the Q3 21 compared to RM14.6 billion in the previous quarter, owing to a higher deficit in the Income accounts.

He added that the goods account registered a higher surplus of RM41.2 billion as the exports declined at a slower rate than the imports that eventually contributed to a higher net export in this quarter, which in turn sustained the surplus in current account balance.

In terms of investment performance, foreign direct investment (FDI) in Malaysia continued to record an inflow of RM12.8 billion from RM8.2 billion while direct investment abroad (DIA) switched to a net inflow of RM4.7 billion from a net outflow of RM4.0 billion in the previous quarter.

Exports of goods grew at 15.8 per cent to record RM303.7 billion and, Imports surged 21.0 per cent to RM242.5 billion. The higher growth in imports has narrowed the trade surplus to RM61.3 billion, 1.1 per cent lower than the third quarter last year.

He said meanwhile, Malaysia’s trade maintained its positive momentum by posting a double digit increase of 18.1 per cent year-on-year, driven by the resumption of domestic economic activity and continuous external demand.

“Exports of goods grew at 15.8 per cent to record RM303.7 billion and imports surged 21.0 per cent to RM242.5 billion.

“The higher growth in imports has narrowed the trade surplus to RM61.3 billion, 1.1 per cent lower than the third quarter last year,” he said.

In terms of the labour market, Mohd Uzir said the number of employed persons rose by 1.2 per cent (15.27 million) compared to the same period last year at 15.1 million.

“As the economy reopened over the quarter, the labour market has continued to improve and regain its momentum.

“This continued dynamic economic activities will hasten the recovery of enterprises and, as a result, raise labour demand, resulting in the creation of more job opportunities,” he said.

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