Malaysia Economic Essay

1580 WordsFeb 4, 20137 Pages
ECONOMIC AND FINANCIAL DEVELOPMENTS IN MALAYSIA IN THE SECOND QUARTER OF 2012 OVERVIEW Malaysia recorded higher growth in the second quarter The global economic environment remained challenging in the second quarter, amidst heightened vulnerabilities in several key economies. Growth in the major advanced economies was weighed down by policy and domestic structural concerns. In Asia, economic activity was affected by weaker external demand. In spite of this challenging environment, the Malaysian economy recorded a higher growth of 5.4% (1Q 12: 4.9%), driven by stronger domestic demand, which rose by 13.8% (1Q 12: 9.7%). This was supported by robust growth in the expenditure of both the private and public sectors, while net exports moderated further due to weaker exports and higher imports. On the supply side, most major economic sectors continued to expand, led by the services, manufacturing and construction sectors. Gross i xed capital formation recorded a stronger growth of 26.1% (1Q 12: 16.1%), amidst increased capital spending by both the private and public sectors. Private investment strengthened further, supported by investment in the domestic-oriented services sub-sectors, oil and gas and manufacturing industries. Expansion in public investment was driven by non-i nancial public enterprises’ capital spending in the transportation, oil and gas and utilities sectors, as well as the Federal Government’s development spending on transportation, trade and industry, public utilities and education. Growth of private consumption registered a strong growth of 8.8% (1Q 12: 7.4%), supported by i rm labour market conditions, robust income growth and improved consumer sentiment. In addition, Government initiatives such as i nancial assistance to the lower income households and FELDA

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