Tuesday, May 07, 2013

PETALING JAYA: Malaysia’s economy is expected to sustain above 5% this year as the continuity of Barisan Nasional’s (BN) leadership remains intact to ensure the Economic Transformation Programme (ETP) projects and policy reforms are implemented without delay or disruption, said economists.

RAM Holdings Bhd group chief economist Dr Yeah Kim Leng described BN’s victory in Sunday’s 13the general election (GE13) as “positive” as it will continue to improve the market and business sentiments.

“Generally, it is positive for the business community because of policy continuity, and an (expected) increase in check and balances. There will be unleashing of plans. We can expect more private investments from local and foreign investors,” he told SunBiz yesterday.

Bank Negara Malaysia expects the country’s gross domestic product (GDP) to grow between 5% and 6% this year, led by private investment growth, from a 5.6% growth in 2012.

“Our (2013 GDP) expectation remains unchanged. The Malaysian economy will be able to sustain above 5% this year,” Yeah said, adding that the government’s ETP will continue to be the growth driver.

“There is no negative impact on consumer confidence and business plans will continue as planned,” he added.

Alliance Research chief economist Manokaran Mottain said the country is on track to achieve its Vision 2020 objective and attain positive economic growth.

He said among the government’s immediate task is to implement its election promises.

“The government has clearly identified certain things in its manifesto like curbing corruption, building affordable houses for the people and many more,” he said.

Manokaran also pointed that there is a need to look into the long delayed goods and services tax (GST) implementation as it will make Malaysia more competitive and efficient.

MIDF Amanah Investment Bank Bhd chief economist Anthony Dass said the government’s focus now is to bring down the budget deficit and the public debt. Public sector debt is estimated at about 53% of GDP as of March 31, 2013, which is still below the legal debt-ceiling threshold of 55% and globally acceptable benchmark of 60%.

He said the government also needs to look at ways to attract investments into the country to boost trade numbers.

“I hope there is no major changes in the policy. Our focus now is to bring down the budget deficit and public debt. I think the GST could be implemented next year,” Anthony added.

By Premalatha Jayaraman