KUALA LUMPUR, Aug 1 (Bernama) — CGS International Securities Malaysia Sdn Bhd believes the average gross domestic product (GDP) growth target of 4.5–5.5 per cent under the 13th Malaysia Plan (13MP), along with the fiscal deficit target of three per cent of GDP by 2030, is attainable.
This was considering Malaysia’s average GDP growth of 4.6 per cent post-Global Financial Crisis (2010–2024), or 5.3 per cent when excluding the pandemic year of 2020, said CGS in a note today.
It noted that the fiscal deficit target aligns with the medium-term goals stipulated in the Public Finance and Fiscal Responsibility Act.
“Although the pace of fiscal deficit consolidation under the 13MP appears more gradual compared to recent years (2021-2024: -6.4 per cent to -4.1 per cent), we feel this is reasonable, given the need to also support economic growth amid tariff-related headwinds.
“We are of the view that recent measures, such as the expanded sales and service tax scope and subsidy rationalisation on diesel (and eventually RON95), could help offset the fiscal deficit pressures amid softer economic growth – underscoring the importance of the MADANI government’s reform agenda,” it added.
Meanwhile, in a separate note, CGS said the 13MP strikes the right balance between the priorities of various economic players while providing sufficient clarity for investors to assess Malaysia’s medium-term prospects.
It said that the 13MP paves the way for a new direction for upcoming federal budgets, and it expects Budget 2026 to be tabled in October, to reflect elements of the plan, including potentially slower growth in development expenditure and greater focus on the newly identified priority sectors.
“Overall, we maintain our 2025 GDP growth forecast of 4.2 per cent year-on-year,” it added.
— BERNAMA
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