Budget 2027 will focus on strengthening Malaysia’s economic resilience and competitiveness while ensuring the benefits of growth are broadly shared, with strategic initiatives centred on governance reform, higher-value economic activities and quality investments, as well as improved living standards and social protection.
The fifth Madani budget and second under the 13th Malaysia Plan will continue advancing the Ekonomi Madani framework while balancing the immediate needs of the rakyat with business activities.
Among other things, the government will prioritise prudent fiscal and strong economic management, including improvements to government procurement, audit compliance and adherence to anti-corruption policies. Bureaucracy will be reduced through the expansion of GovTech, including cross-agency data integration and end-to-end digital services.
Institutional reforms will continue through proposed legislation covering the separation of powers between the attorney general and public prosecutor, a comprehensive ombudsman bill, freedom of information and state-owned entities.
High-growth, high-value (HGHV) projects will also receive priority to address critical infrastructure gaps, strengthen connectivity and regional development, and enhance economic capacity and resilience.
Continued subsidy rationalisation and public-sector reform will create fiscal space for strategic priorities.
For micro, small and medium enterprises (MSMEs), access to financing for export-oriented and HGHV activities will continue to be strengthened through guarantee programmes.
The government will also strengthen the Invest Malaysia Facilitation Centre to expedite approvals and accelerate the conversion of investment commitments into realised projects.
The outcome-based New Incentive Framework will place greater emphasis on technology upgrading, quality employment, local supplier development, technology transfer and productivity improvements.
Priority will be given to strategic sectors including semiconductors, artificial intelligence (AI), digital services, energy transition, pharmaceuticals, logistics and aerospace.
Meanwhile, investments in renewable energy capacity, battery storage, national grid upgrades and Asean interconnection will be accelerated as Malaysia transitions towards a low-carbon and climate-resilient economy. Carbon capture, utilisation and storage and hydrogen will also be prioritised.
Digitalisation and AI adoption will remain key priorities, alongside stronger AI literacy, digital capabilities and cybersecurity resilience. The National post-quantum cryptography Migration Plan 2025-2030 will also be advanced. Public expenditure will focus on quality transport connectivity, digital infrastructure, healthcare and education, particularly in Sabah and Sarawak and rural and interior areas.
Budget 2027 will also continue targeted cash assistance and subsidies, while retirement and social security protection frameworks under the Employees Provident Fund, or EPF, and Social Security Organisation, or Socso, will be reassessed.
Education and healthcare reforms will focus on access, affordability, digital and AI capabilities and system capacity, while labour market reforms will emphasise technology adoption, reskilling and upskilling, higher wages and greater female labour force participation.
