KUALA LUMPUR, Jan 16 — The 5.7 per cent gross domestic product (GDP) growth estimate in the fourth quarter of 2025 (4Q 2025) shows that the principles of governance, sustainability and social justice premised on the Madani Economy framework are reaping tangible results, an economist said today.
IPPFA Sdn Bhd director of investment strategy and country economist Mohd Sedek Jantan said it also proves that Malaysia has been able to navigate the challenges surrounding tariffs imposed on the country and presents itself as an investible market in South-east Asia.
He said that the timely execution of the 13th Malaysia Plan (13MP) would be critical to drive economic expansion through productivity, embracing technology and mobilising entrepreneurship.
Mohd Sedek said the 4Q GDP projection exceeded all economists’ estimates and confirms that Malaysia’s growth momentum was sustained into the end of the year.
“While structural reforms naturally take time to fully materialise, the data indicate that their impact is starting to be reflected in real economic outcomes. The focus on execution, labour market stability, investment facilitation and targeted support has helped strengthen domestic demand and restore confidence among businesses and households.
“In this sense, the stronger-than-expected 4Q outcome reflects not just cyclical recovery, but the early results of the Madani government’s economic approach,” he told Bernama in response to the latest estimates released by the Department of Statistics Malaysia (DOSM).
DOSM reported that the 5.7 per cent 4Q 2025 estimate was an acceleration when compared with the 5.2 per cent growth in the previous quarter, supported by a strong performance in the main economic sectors and robust domestic demand.
“The 5.7 per cent growth was the highest since the second quarter of 2024 (2Q 2024: 5.9 per cent). For 2025 as a whole, Malaysia’s economy is estimated to grow 4.9 per cent, approaching the 5.1 per cent growth in 2024,” it said.
Mohd Sedek said the 4.9 per cent GDP growth indicates that the economy is stabilising rather than slowing, particularly given the external uncertainties faced during the year, including concerns over debilitating tariffs announced by US President Donald Trump.
“While the full impact of these tariffs only began to be felt in September, Malaysia was able to navigate this period without a sharp disruption to growth. This reflects that trade is an important component of the economy, but not the sole driver.
“Domestic demand, services activity and ongoing investment execution continued to provide a stable growth base,” he said.
Mohd Sedek also said that the growth of 5.1 per cent in 2024 and 4.9 per cent in 2025 implies that Malaysia is operating from a relatively high base.
“Maintaining growth consistently at or above 5.0 per cent will therefore require fresh catalysts; 13MP is one of them, rather than relying on cyclical recovery alone. Importantly, faster or ‘spike’ growth is not necessarily the objective,” he said.
Mohd Sedek said under the Madani Economy framework, the focus is on achieving a higher floor and a higher ceiling – growth that is more equitable, resilient and inclusive.
“Ultimately, the key measure of success is not GDP alone, but whether households have sufficient income to meet day-to-day needs and whether economic progress is felt broadly across society.
“This is precisely why the execution quality and timeliness of the 13MP will be critical. We see 13MP as the bridge from execution-driven growth to productivity-driven expansion. It must prioritise timely project mobilisation, private investment crowd-in, skills upgrading, micro, small and medium enterprises scaling and technology diffusion,” he said.
Notably, Malaysia’s economy, which is estimated to grow by 4.9 per cent in 2025, is projected to expand at the same pace as China’s expected GDP growth.
Mohd Sedek said the comparison is meaningful not because Malaysia and China are comparable in scale, but because it highlights Malaysia’s resilience as a small, open economy.
“China’s growth is supported by a large domestic market and significant policy buffers, so Malaysia recording a similar growth rate in 2025 points to a relatively strong internal demand and investment execution.
“Regionally, this places Malaysia in a solid position among upper-middle-income Asian economies, reflecting economic stability rather than outperformance,” he said.
In practical terms, it reinforces Malaysia’s standing as a steady and investible market within Asean amid a challenging global environment, said Mohd Sedek. — Bernama
