Malaysia to cut 2021 GDP growth outlook, possibly close to 4%

Soldiers putting up barbed wire at PPR Sri Rakyat in Bandar Bukit Jalil in Kuala Lumpur. The apartment is under the enhanced movement control order until July 24. An estimated 5,500 residents live here and 160 have tested positive for Covid-19. — S.S.Kanesan/The Star

KUALA LUMPUR: Malaysia will downgrade its economic growth outlook this year, according to the country’s finance minister, signaling that it could see expansion around 4%.

While there is optimism the spread of Covid-19 can be contained and lockdowns can be eased, the government still expects to lower its gross domestic product outlook for this year, Finance Minister Tengku Zafrul Abdul Aziz said in an interview with Bloomberg TV’s Sophie Kamaruddin on Monday.

When asked if it could be lowered to around 4%, Tengku Zafrul responded "around the range you mentioned.” The government has already said it will revise its current 6%-7.5% outlook for 2021 in August.

The government of Prime Minister Tan Sri Muhyiddin Yassin is coming under increasing pressure as the pandemic crisis grinds on, with lockdowns hurting the economy and only about 1/10th of the population fully vaccinated, while the largest party in his ruling coalition withdrew support for him.

Tengku Zafrul was appointed last week as the coordinating minister for Malaysia’s National Recovery Plan, responsible for monitoring the implementation of strategy, including intervention measures. - Bloomberg