[ad_1]
KUALA LUMPUR: The World Bank expects Malaysia’s economy to grow 6.7% next year after a projected contraction of 5.8% this year due to the impact of the Covid-19 pandemic.
He said Thursday that positive factors that could help underpin the recovery would be the successful containment of the third wave of the 19 infections.
The World Bank said that effective implementation and distribution of the vaccine could lead to a faster-than-expected recovery in consumer demand, greater investor confidence, and consequently a stronger recovery in domestic economic activity. in 2021.
His perspective was contained in the latest edition of the World Bank’s “Malaysia Economic Monitor: Sowing the Seeds” which was released on Thursday.
“Signs of recovery are showing with Malaysia registering a minor contraction of 2.7% in 3Q 2020 compared to 17.1% in 2Q.
“Fiscal measures such as cash transfers and wage subsidies have boosted household spending and private consumption has contracted by 2.1% in 3Q 2020 compared to 18.5% in 2Q.
“However, the recent spike in Covid-19 cases and renewed motion controls could slow the recovery due to uncertainties surrounding the deployment of an effective vaccine and the robustness of a global growth pickup that will influence the pace. of economic recovery, “he said. .
The report noted that the top short-term priorities were containing the pandemic and protecting the most vulnerable.
The report expects Malaysia to return to its pre-pandemic trend at a modest pace in the medium term.
As health risks diminish and the economy continues to recover, efforts should gradually shift from focusing on short-term policies to facilitating economic adjustments to enable new growth in the post-pandemic environment.
The Minister of the Economy Department of the Prime Minister in charge, Datuk Seri Mustapa Mohamed, said in the statement that seizing new growth opportunities and overcoming the potentially long-lasting challenges brought on by the Covid-19 crisis means bold structural reforms in the medium term. .
“Malaysia needs to build on its recovery from this crisis to emerge as a more durable and inclusive economy in a structurally different post-pandemic future,” he said.
Meanwhile, Ndiame Diop, the World Bank’s country director for Brunei, Malaysia, the Philippines and Thailand, said the prolonged economic impact of the pandemic underscores the importance of taking a proactive approach to policy making.
Thus, a clear set of strategies can be developed for different phases of economic recovery, based on difficult trade-offs between providing relief today and stimulating growth tomorrow.
Diop noted that the Covid-19 crisis has also drawn attention to Malaysia’s food system and the continued relevance of food safety, as well as the need for food policy to focus on a broader range of risks and opportunities.
The World Bank report’s special focus on the agricultural sector highlights the importance of modernizing and diversifying the agri-food sector and transforming it into a more dynamic food economy “from farm to fork”.
He said such a transition will help advance other national development priorities, including boosting shared prosperity.
Malaysia’s Twelfth Plan, to be released in January, provides a crucial opportunity to expose the potential of the agricultural sector and the role of government in facilitating its transformation.
The World Bank said that the policies implemented should aim to improve food security, improve agricultural livelihoods, modernize and inject dynamism into the agri-food economy and ensure its resilience, competitiveness and sustainable growth.
[ad_2]
