KUALA LUMPUR, Dec. 18 (Xinhua) -- Supported by strong domestic fundamentals and strategic investments, economists expected moderate growth for Malaysia in 2025. However, external challenges could temper its growth momentum.
The Malaysian Industrial Development Finance Berhad, an investment research house, said in a recent report that Malaysia's domestic economic fundamentals remained strong, buoyed by resilient consumer and business spending.
Similarly, UOB Global Economics and Markets Research pointed to stable labor market conditions, ongoing investments, and energy transition initiatives as critical factors underpinning Malaysia's domestic resilience.
Meanwhile, Malaysia's upcoming chairmanship of ASEAN in 2025, along with its preparations for Visit Malaysia Year 2026, will boost tourism, economists said.
OCBC Bank projected robust growth in services exports, particularly in tourism, as the government ramped up efforts to attract international visitors.
OCBC also cited Malaysia's progress in medium-term development initiatives such as the New Industrial Master Plan 2030, the National Semiconductor Strategy, the National Energy Transition Roadmap, and the Johor-Singapore Special Economic Zone.
The government has indicated plans to resume free trade agreement negotiations with the European Union and has applied for BRICS membership. Both are expected to diversify Malaysia's export markets, boosting trade resilience and opportunities.
Despite domestic resilience, external challenges such as tariff uncertainty are expected to weigh on Malaysia's economic growth.
Maybank expected Malaysia's economic growth to moderate to 4.9 percent in 2025, down from 5.2 percent in 2024, due to weaker export performance amid global trade uncertainties.
UOB predicted Malaysia's economic growth at 4.7 percent in 2025, citing potential headwinds from potential protectionism trade policies.■