Malaysia’s economy could shrink as much as 2% this year

Malaysia’s economy could shrink as much as two per cent in 2020 as a result of the coronavirus pandemic, the country’s central bank said in its latest Economic Monetary Review report. The bank agreed with the prediction of the International Monetary Fund of a worldwide recession that will match the severity of the 2008 financial crisis as the virus continues to disrupt economies globally.

The report said the pandemic introduced significant economic uncertainties, putting pressure on global trade that grew by just one per cent last year due to unresolved trade tensions.

“Against this highly challenging global economic outlook, Malaysia’s GDP growth is projected to be between minus two and 0.5 per cent in 2020,” the report said, adding that “the domestic economy will be impacted by the necessary global and domestic actions taken to contain the outbreak.”

Vulnerable economy already before the crisis

The lower end of the prediction is the most pessimistic to date, exceeding the World Bank’s revised outlook of a 0.1 per cent contraction for Malaysia this year. It would be the first time that Malaysia’s economy has receded since 2009, when it shrunk 1.5 per cent in the aftermath of the global banking crisis then. Tourism is set to be the worst-hit sector due to travel restrictions.

Aside from the pandemic, Malaysia’s domestic economy before was also vulnerable to volatility in global oil prices as well as possible fluctuations in the production of key commodities such as palm oil.

However, the country’s central bank projected a recovery as early as the second half of 2020 or 2021 at the latest. It pointed out that both the central bank itself and the federal government have taken “aggressive measures” to support the economy in this challenging period, citing the automatic six-month loan moratorium starting April as well as a stimulus package, among others.



Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

$
Personal Info

Donation Total: $10.00

 

 

Malaysia’s economy could shrink as much as two per cent in 2020 as a result of the coronavirus pandemic, the country’s central bank said in its latest Economic Monetary Review report. The bank agreed with the prediction of the International Monetary Fund of a worldwide recession that will match the severity of the 2008 financial crisis as the virus continues to disrupt economies globally. The report said the pandemic introduced significant economic uncertainties, putting pressure on global trade that grew by just one per cent last year due to unresolved trade tensions. “Against this highly challenging global economic outlook, Malaysia’s...

Malaysia’s economy could shrink as much as two per cent in 2020 as a result of the coronavirus pandemic, the country’s central bank said in its latest Economic Monetary Review report. The bank agreed with the prediction of the International Monetary Fund of a worldwide recession that will match the severity of the 2008 financial crisis as the virus continues to disrupt economies globally.

The report said the pandemic introduced significant economic uncertainties, putting pressure on global trade that grew by just one per cent last year due to unresolved trade tensions.

“Against this highly challenging global economic outlook, Malaysia’s GDP growth is projected to be between minus two and 0.5 per cent in 2020,” the report said, adding that “the domestic economy will be impacted by the necessary global and domestic actions taken to contain the outbreak.”

Vulnerable economy already before the crisis

The lower end of the prediction is the most pessimistic to date, exceeding the World Bank’s revised outlook of a 0.1 per cent contraction for Malaysia this year. It would be the first time that Malaysia’s economy has receded since 2009, when it shrunk 1.5 per cent in the aftermath of the global banking crisis then. Tourism is set to be the worst-hit sector due to travel restrictions.

Aside from the pandemic, Malaysia’s domestic economy before was also vulnerable to volatility in global oil prices as well as possible fluctuations in the production of key commodities such as palm oil.

However, the country’s central bank projected a recovery as early as the second half of 2020 or 2021 at the latest. It pointed out that both the central bank itself and the federal government have taken “aggressive measures” to support the economy in this challenging period, citing the automatic six-month loan moratorium starting April as well as a stimulus package, among others.



Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

$
Personal Info

Donation Total: $10.00

 

 

NO COMMENTS

Leave a Reply