KUALA LUMPUR – Malaysia’s gross domestic product is projected to grow by 6% this year, a more moderate pace than the previously estimated 6.7%, said the World Bank.
It said the growth is expected to be supported by the gradual strengthening of domestic demand following the Covid-19 vaccine deployment starting this month, as well as cautious improvements in external demand.
“The strength and timing of Malaysia’s economic recovery, however, will depend largely on the timely availability of an effective mass vaccination programme.
“The programme is expected to cover at least 30% of the population by August 2021,” it said in the Economic Update for East Asia and the Pacific – Uneven Recovery report released today.
Nevertheless, the bank anticipates that in the medium term, output for the economy is unlikely to return to pre-pandemic levels.
“The growth outlook is subject to considerable downside risks. On the external front, further delays in the implementation of vaccination programmes could lead to recurrent lockdowns in advanced economies and dampen global growth.
“Upside risks include a successful mitigation of the third wave (of infections), and the effective roll-out and implementation of vaccination programmes, which could lead to a faster-than-expected recovery in domestic demand and greater investor confidence.”
It said the number of Malaysians living below the national poverty line is projected to decrease gradually and remain at pre-pandemic levels until next year.
“This projection is predicated on the assumption that recovery in household employment and income is likely to be uneven, with tourism and other high-contact service occupations expected to be among the slowest to improve.
“The projection is also contingent upon a substantial rebound in employment and continued government relief measures to protect poor and vulnerable households, pending a full recovery of the economy.” – Bernama, March 26, 2021
