Malaysia’s economy grew 5% in 2015

Malaysia

KUALA LUMPUR: Malaysia’s economy expanded by 5% in 2015, which was slightly faster than the economists’ forecast of a growth of 4.9%, underpinned by the manufacturing sector.

While the growth as measured by the gross domestic product (GDP) was faster than expected, the country grew at a slower pace compared with 6% growth in 2014.

The Statistics Department said on Thursday that in the fourth quarter (Q4, 2015), Malaysia’s GDP expanded at a slower pace of 4.5% compared to 4.7% in the third quarter. 

“On a quarter-on-quarter seasonally adjusted, the economy increased 1.5%,” the department said.

Services sector

The department said that in the fourth quarter, the services sector expanded at a faster pace of 5.0% from 4.4% in the third quarter (Q3, 2015). 

“The performance of services sector was underpinned by wholesale & retail trade which advanced to 6.5%. Information & communication remained resilient by posting a growth of 9.2%. 

“Meanwhile, transportation & Storage rose to 6.0% following a better momentum in freight and
passenger segments,” it said.

Manufacturing sector

As for the manufacturing sector, it expanded at a faster pace of 5% (Q3, 2015: 4.8%). 

It said the key driver in manufacturing, electrical, electronic & optical products posted a sturdy growth at 10.5% reflecting a higher momentum in consumer electronics and medical equipment products.

Construction

Construction sector grew 7.4% (Q3, 2015: 9.9%). Civil engineering posted an impressive growth of 20.4%, supported by oil & gas and transportation related projects. Residential buildings recorded a 5.7% growth, up from 5.2% in the preceding quarter.

Meanwhile, Bank Negara Malaysia (BNM) said the Malaysian economy is expected to face a challenging operating environment in the immediate future. 

The central bank said growth would continue to be driven by domestic demand, with some support from net exports. 

“Nevertheless, the pace of domestic demand expansion is projected to moderate. While the growth in income and employment continues to support private consumption, it is expected to moderate as households continue to adjust to the higher cost of living. 

“Meanwhile, private investment is projected to moderate to below its long term trend but will nevertheless be supported by the capital expenditure in the manufacturing and services sectors, as well as the implementation of infrastructure projects. 

“The downside risks to growth will however remain, given the continued uncertainty in the external environment and the on-going reforms in the domestic economy,” it said.