Friday, 13 January 2017
KUALA LUMPUR: There is no necessity to recalibrate Budget 2017, as Malaysia is on the right track towards strong growth this year, according to Second Finance Minister Datuk Johari Abdul Ghani.
While acknowledging that more steps might be taken to address the declining ringgit, he stressed that there was no need to make adjustments to the Government’s fiscal spending and revenue projections.
Research houses have mixed views on Malaysia’s economic outlook, given the depreciating ringgit and the prospects of president-elect Donald Trump implementing policies that might negatively impact emerging markets. Standard Chartered has projected the country’s gross domestic product (GDP) to grow at a moderate 3.8% this year. In contrast, RAM Ratings has forecast GDP growth at 4.5%.
Malaysia’s GDP for 2016 is forecast at 4.2%.
Johari explained that the current historically low oil prices have a bearing on the ringgit, as the commodity and currency’s movements are closely correlated.
The impact of the lower oil prices would be minimal, as crude oil income constituted just 14% of the total Government revenue compared with 41% in 2009, he added.
During a closed-door meeting with foreign fund managers, Johari said that the reception towards Malaysia was largely positive.
According to the Security Commission, the foreign insitutional investors at the meeting collectively managed over US$19 trillion, representing 26% of the total assets under management (AUM) globally.
Malaysia’s capital markets remained robust, with a healthy RM978bil in funds raised over the past 10 years.
As for the Islamic capital markets, Malaysia has the highest number of Islamic funds and the second-largest AUM for Islamic funds in the world, he said.
Source by: Internet