Malaysia is setting its sights on reducing its fiscal deficit to 3% of gross domestic product (GDP) or lower within the next 10 years, according to Prime Minister Anwar Ibrahim. In a recent speech, he outlined the government’s medium-term objectives, highlighting this as a key priority.
Current Fiscal Position
As of 2022, Malaysia’s fiscal deficit stood at 5.6% of GDP. This figure serves as an important baseline for the government’s future fiscal planning and reform efforts.
In addition to the deficit reduction target, Malaysia has set several other ambitious goals for the next decade. These include:
Breaking into the Top 30 Economies: Malaysia aspires to be among the world’s top 30 largest economies. This highlights the nation’s determination to strengthen its global economic standing.
Global Competitiveness: The aim is for Malaysia to secure a top 12 ranking on the Global Competitiveness Index. This will require continuous efforts to enhance various aspects of the nation’s competitiveness.
Increased Labor Income Share: Anwar underscored the importance of raising the percentage of labor income to 45% of total income. This move will contribute to a fairer distribution of wealth and improved living standards for Malaysians.
Empowering Women in the Workforce: Malaysia intends to achieve a women’s participation rate in the labor force of 60%. This aligns with the government’s commitment to gender equality and fostering inclusive economic growth.
Human Development Index and Corruption Perceptions Index: The goal entails attaining a position within the top 25 on the Human Development Index and being recognized as one of the top 25 least corrupt nations on the Corruption Perceptions Index. These achievements will reflect Malaysia’s commitment to social progress and good governance.
Economic Growth Potential
Anwar emphasized that Malaysia’s economic growth could reach 6% with concerted efforts and comprehensive reforms. While current projections indicate growth between 4% to 5%, the Prime Minister believes that with dedication and reform implementation, the target of 5.5% is within reach, with the possibility of even achieving a 6% growth rate.
Outlook for 2023
Malaysia’s government foresees a moderation in economic growth to around 4.5% in 2023. This follows an impressive 8.7% expansion recorded in the previous year.
In conclusion, Malaysia has set its sights on multiple strategic objectives to enhance the nation’s fiscal stability, economic growth, competitiveness, gender equality, human development, and governance standards. By focusing on these goals, Malaysia aims to carve out a brighter future for its citizens and position itself as a leading player on the global stage.