Malaysia’s economy experienced a solid 5.1% growth in 2024, driven by robust domestic demand and a strong performance in investment, despite challenges in the commodities sector. According to the central bank, Bank Negara Malaysia, the country’s Gross Domestic Product (GDP) grew by 5% in the fourth quarter of 2024, slightly slowing from 5.3% in the third quarter but surpassing an initial estimate of 4.8%.
This marks a significant improvement compared to the 3.7% GDP growth recorded in 2023, reflecting a positive shift in the nation’s economic trajectory.
Bank Negara Malaysia’s Governor, Abdul Rasheed Ghaffour, indicated that while global economic conditions may remain difficult, Malaysia’s economy is poised for continued growth. He emphasized that strong investment activity, resilient household spending, and expanding exports, underpinned by the nation’s solid economic fundamentals, will continue to drive Malaysia’s growth moving forward.
Inflation in Malaysia also saw a favorable decline, dropping to 1.8% in 2024, a decrease from 2.5% the previous year. Meanwhile, the Malaysian ringgit appreciated by 2.7% against the US dollar and also saw gains against other major currencies, including the Singapore dollar, South Korean won, and Japanese yen.
Despite the overall positive growth, Bank Negara Malaysia highlighted that Malaysia’s economic outlook remains subject to risks, such as the potential slowdown in growth among Malaysia’s trading partners. Additionally, trade restrictions and weaker commodities production could pose challenges. However, the central bank also pointed to potential upside opportunities for growth, including a boost from the ongoing tech upcycle, a rebound in tourism, and the faster implementation of investment projects.
With these factors at play, Malaysia’s economy is expected to remain on a strong growth trajectory in the near future, driven by both domestic and global factors.
