KUALA LUMPUR: With Malaysia’s real GDP expanding by 6.2% year-on-year in the third quarter (Q3) versus the 5.8% recorded in Q2’17, BMI Research expects the country’s business environment to remain positive.
“The government’s leading indicator suggests that economic momentum remains strong, and we expect the business environment to remain positive amid ongoing efforts by the government to improve the bureaucracy,” the research house said on Monday.
It noted that strong public infrastructure investment drive will lend additional support.
BMI Research upgraded its real GDP forecast for 2017 and 2018 to 5.9% and 5.5% respectively, from 5.3% and 5.0% previously.
Malaysia’s real GDP expanded by 6.2% on-year in Q3’17, beating consensus expectations of 5.7%.
The growth was broad-based, with the manufacturing sector being an outperformer.
“Leading indicators suggest that economic momentum remains strong and we expect ongoing plans to improve Malaysia’s bureaucracy to be positive for the business environment.
“The upcoming general elections (which must be held by August 2018) are also unlikely to dent investor confidence, lending further support to growth,” it said.
The research house noted that political risk in Malaysia had receded considerably following the uncertainty in 2015-2016.
“With (Prime Minister Datuk Seri Najib Tun Razak) having consolidated his position, we believe that the upcoming general elections are unlikely to lead to a significant loss in investor confidence towards Malaysia and expect the business environment to remain positive,” it said.
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