Malaysia saw economic growth fell to its lowest level in 10 years amid lower private consumption and external demand as a result of a gloomy global economy.
Malaysian central bank governor Nor Shamsiah Yunus told a news briefing on Wednesday, February 12, that gross domestic product (GDP) last year rose only by 4.3 percent, as compared with the 4.8 percent logged in 2018.
For the fourth quarter alone, GDP rose by 3.6 percent—also its lowest since the 2009 global financial crisis—versus the 4.9 percent and 4.4 percent recorded in the second and third quarters of last year.
Yunus pointed slower fourth-quarter growth to the weaker exports of net goods and services coupled with a slower public consumption.
Commenting on the released figures, Maybank Investment Research said that fourth-quarter GDP was dampened by a drop in agriculture and mining and manufacturing output.
“Demand-side optics are not great, as indicators point to a slowdown in both domestic demand and net external demand last quarter. The retail trade index growth moderated, suggesting a further slowdown in real private consumption,” it added.
Coronavirus to dampen Q1 growth
Amid the deadly virus outbreak that originated in China, Malaysia is expecting the first-quarter GDP to be affected negatively but the magnitude will depend on how the virus spreads and evolves.
In Malaysia alone, a total of 18 cases were confirmed to be infected with the virus.
“Coronavirus outbreak would affect Malaysia’s growth through lower foreign tourists and spending on hotels, retails, transport and restaurants,” the central bank governor said.
“Also slower demand and production disruptions in China affecting Malaysia’s exports in the manufactured and commodities exports segment,” she added.
To mitigate the impact, the local financial industry announced preventive measures to assist those affected by the outbreak, including giving borrowers moratorium and temporary relief on financial commitments.
Earlier this year, Malaysian Prime Minister Mahathir Mohammad announced that Malaysian exports would clock in at 4.8 percent this year, on the back of an improved global economic outlook and private consumption.
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