The Pakatan Harapan (PH) government stayed true to its promises when it tabled a budget that is people-centric and pro-growth, while boosting confidence, in the spirit of inclusivity and shared prosperity.
IQI Global chief economist Shan Saeed said the government remained committed to consolidating its fiscal deficit and debt level relative to the gross domestic product (GDP) and yet did not forget the man in the street and small businesses.
“We have shared before the tabling of today’s budget that the government is cognisant of the fact that global economic outlook remains fragile and many advanced economies are having sub-par (growth), thus, under such macro circumstances, this can be termed as a balanced budget for 2020.
“The government has sent strong signals to the market that the Goods and Services Tax (GST) would not be implemented, which would be a big relief to the man in the street whose key concerns are the cost of living and rising prices,” he told Bernama.
Shan said local entrepreneurs would get support from government’s efforts to maintain economic confidence which would help in attracting foreign direct investment (FDI), while massive infrastructure investment would bolster GDP growth.
“Infrastructure investment contributes 0.2 per cent to 0.7 per cent to the overall GDP growth rate. It has a direct correlation with income growth in the long run. Technologically focused labour force can enhance productivity on a broader scale. In the next five to 10 years, the tech-savvy workforce would boost the GDP growth.
“Government is set to buttress urbanisation in Malaysia. (On a) rule of thumb (basis), a 20 per cent increase in the country’s urbanisation rate is going to double the income per person,” he said.
Shan also observed that the government wanted to improve trade with various regions to build and keep the economy on an upbeat momentum.
“Malaysia is an important player in the Belt and Road equation. We at IQI Global are cautiously optimistic about Malaysia’s growth story in 2020. We foresee its GDP growth next year to be between 4.4 per cent and 4.9 per cent,” he added.