KUALA LUMPUR, March 11 — The Malaysian economy is projected to grow by between 4.5 and 5.5 per cent with the services and manufacturing sectors remaining the key drivers of overall growth, says Bank Negara Malaysia (BNM).

Malaysia’s strong underlying fundamentals would act as a buffer to mitigate the impact of risky external developments such as a sharper-than-expected slowdown in China, which posed downside risk to global growth and trade.

Last year, the Malaysian economy expanded six per cent lifted by privatedomestic demand and improvement in external trade development.

In 2015, the services and manufacturing sectors is forecast to grow, albeit, slower by 5.6 per cent and 4.9 per cent, respectively, compared with 6.3 per cent and 6.2 per cent, respectively, recorded last year.

Mining and quarrying, agriculture, as well as, construction sectors would also see a slower growth by three per cent, 0.3 per cent and 10.3 per cent, respectively, compared with 3.1 per cent, 2.6 per cent and 11.6 per cent, respectively, in 2014, said BNM.

The central bank, in its 2014 Annual Report, said domestic demand was expected to register a sustained growth of six per cent in 2015, same as 2014, anchored by private sector expenditure.

Private consumption, however, was forecast to record a more moderate growth of six per cent in 2015, lower than 7.1 per cent last year.

“The implementation of the Goods and Services Tax (GST) on April 1 may have some effect on household spending. This will, however, be partially offset by the government’s measures to assist targeted groups,” it said.

BNM said after three years of strong double-digit growth, private investment was expected to expand by nine per cent in 2015.

It said the private sector’s capital spending would continue to be supported by on-going projects and a steady inflow of new investments, particularly in the manufacturing and services sector.

Public consumption was projected to expand 2.7 per cent in 2015, reflecting sustained growth in emoluments amid lower spending on supplies and services following the government’s expenditure rationalisation measures.

Meanwhile, public investments would turn around and register a positive growth of 5.1 per cent, said BNM.

“While capital spending by both the public enterprises and the Federal government is expected to increase in 2015, the larger contributor will come from public enterprises.

“Investments from public enterprises reflect the continued implementation of key infrastructure projects, particularly in the utility and transportation sub-sector,” said the central bank. — Bernama