Two of the major drivers in Malaysia's economy are expected to help the country achieve steady economic growth this year amid external headwinds such as global trade disputes and faltering U.S. currencies.
According to The Star, Economic Affairs Deputy Minister Dr. Mohd Rahzi Md Jidin said the Asian country will steadily grow through the help of increased private consumption in the manufacturing and service sectors. He said external factors will contribute to some developments, although not huge.
Mohd Radzi said the two sectors combined account for around 79 percent of Malaysia's growing economy. Private consumption and local demand will drive growth in these industries and will then result in improved economic figures.
Despite trade disputes and currency fluctuations in the west, Mohd Radzi said the manufacturing sector is expected to expand by 4.8 percent while the service sector will most likely balloon by up to 5.7 percent. Positive growth is expected in these major sectors due to increased purchases from private entities and institutions.
Before the start of April, manufacturing firms reported that they have been experiencing a decline in orders. For the sixth straight month since October, the composite single-figure indicator of manufacturing performance in Malaysia dropped at 47.2 from February's 47.6 reading.
On the other hand, manufacturers in the country showed optimism for future output and sales. According to the New Straits Times, some manufacturing companies reported improved demand from Japan and Germany. Manufacturing employment also recorded stability as a whole.
The latest Nikkei Malaysia Manufacturing Purchasing Managers' index revealed that there were stable price levels in Malaysia's manufacturing sector in March. Sales and the entry of new projects helped boost the outlook of firms and providers.
In the Malaysian services sector, involved groups have called for reducing the deficit that has been hampering growth in the industry. Last month, the Malaysian Investment Development Authority (MIDA) recommended the use of an i-Services Portal. The platform will be used by service providers to have better connections with potential clients.
Service providers have been urged to register their businesses with the i-Services Portal to help them enhance visibility in the Malaysian market. The platform also aims to reduce reliance on foreign service providers so domestic providers can have a higher chance to sell their services.
"Domestic and international companies could also avail themselves to this portal as a gateway to source local services, which provides a cost-efficient and convenient way of conducting business," MIDA said in the recently released Malaysia Investment Performance Report 2018.
