KUALA LUMPUR, Oct 8 – The World Bank Group has upgraded Malaysia’s economic growth forecast to 4.9 per cent in 2024 from its initial 4.3 per cent forecast set in April, according to Apurva Sanghi, its lead economist for Malaysia.
He said both domestic and external factors back the upgraded growth forecast as the global economy is doing much better than expected six months ago.
On the domestic front, he said the positive economic momentum, rising political stability, and an increasingly conducive policy environment that boosts and mobilises more investments, have contributed to the upgraded growth projection.
“Global growth is expected to stabilise at around 2.6 per cent this year, despite ongoing geopolitical tensions and high interest rates, while inflation is receding, so there is a new appetite for growth especially in advanced economies.
“Malaysia is in a good place. In emerging markets in general, (there are) positive trends in consumer confidence, manufacturing and services,” he told the media during a briefing of the October 2024 Malaysia Economic Monitor (MEM) at the World Bank office here today.
According to Sanghi, Malaysia’s per capita output growth, which is used to measure welfare, is 12 per cent higher than the pre-pandemic level and outperforming its ASEAN peers.
“This means that high income status for Malaysia is within reach – based on our assumption of the US dollar against the ringgit at the 4.54 level and with an average growth rate of 4.3 per cent, we expect Malaysia to reach the high income nation status by 2028.
“If the US dollar and ringgit exchange rate stays at the current level of about 4.20, then the high income goal (could be reached) a year earlier in 2027,” he said, adding that the high income nation is not the same as a high development nation and that there is always a risk of reversal.
