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The Asian Development Bank (ADB) has projected Malaysia’s economy to grow at 4.7% in 2023, and 4.9% in 2024.
The ADB said in its latest Asian Development Outlook report released on April 4 that Malaysia’s growth exceeded expectations in 2022, buoyed by strong domestic consumption and a rebound in services, as borders reopened and economic activity normalised.
The bank said inflation remained broadly muted, dampened by government subsidies and price controls, adding that a less accommodative monetary stance was adopted in response to higher global interest rates.
Growth is expected to moderate, and inflation to decelerate in 2023 and 2024, mainly tracking changes in the global environment, it noted, saying that Malaysia should promote gender-inclusive policies to boost women’s participation in the labour market.
According to the ADB, Malaysia’s economic performance in 2023 will depend on the external environment, including spillovers from the reopening of China, government policy support, and developments in the electronics industry.
In a less promising forecast, S&P Global Ratings on April 5 said Malaysia's economic growth is expected to ease to 3.2% this year, following the strong growth of 8.7% in 2022.
Its Asia-Pacific economist Vishrut Rana said the downtrend reflects external weaknesses, as the global trade and electronics industry cycle softens this year, after two years of strong growth and activity./.