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Central bank projects Malaysian economy to grow 6-7.5% in 2021

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Slow and steady path to recovery 

By: Tricia Ang | 13 April 2021

Photo by @esmonde on Unsplash

Malaysia’s economy will likely grow by 6 to 7.5 % this year, rebounding from last year’s contraction, thanks to improved external demand and increased investment and production, the central bank said on Wednesday.

According to Bank Negara Malaysia’s annual report, GDP will return to pre-Covid-19 levels by mid-year, though the ongoing pandemic poses a downside risk.

In the paper, Governor Nor Shamsiah Mohd Yunus said, “The path of recovery will be gradual and uneven across economic sectors, and it may encounter speed bumps along the way.”

The central bank had earlier projected a growth range of 6.5 per cent to 7.5 per cent.

Malaysia’s economy shrank 5.6 per cent in 2020, suffering its most acute full-year contraction since the Asian Financial Crisis in 1998.

Monetary policy will remain accommodative in 2021, according to the central bank, to support a sustained economic recovery following the pandemic.

It also stated that it intended to increase its focus on digital economy initiatives, such as digital bank licensing and online payment services.