Guan Eng: Govt stands by roadmap on fiscal consolidation to restore economy

Guan Eng: Govt stands by roadmap on fiscal consolidation to restore economy

KUALA LUMPUR: The government has designed a three-year financial roadmap to put Malaysia back on fiscal track and restore the country’s economic health despite entrenched uncertainties brought about by the US-China trade war which has permanently reoriented the global supply chain.

The government is on track to achieve the targeted deficit of 3.4 per cent of gross domestic product (GDP) in 2019.

The fiscal target is revised to 3.2 per cent of GDP in 2020 from 3.0 per cent previously, but it remains on track to reach 2.8 per cent in the medium term.

“The increase from 3.0 per cent to 3.2 per cent might not sound a lot, but remember – when it comes to spending, it is not only about how much is spent but also on what the spending is on,” Finance Minister Lim Guan Eng said in his speech at the 2020 Budget Forum, here today.

He said a lot of the measures in the budget will not only support growth in the short term, but also ferment the foundations necessary for Malaysia transform structurally into the decades ahead.

The measures are in line with the recently launched Shared Prosperity Vision 2030 which require the creation of prosperity before there is prosperity to be shared.

“Incentivising businesses and attracting foreign investment with incentives valued at RM10 billion over 10 years, together with the RM6.5 billion job creation programme which creates 350,000 jobs, will put Malaysians back to work and back in business.

“The 2020 Budget I tabled last week outlines the policy direction this government is taking. My message is simple: Malaysia is reindustrializing by digitalizing our economy, by integrating with the global supply chain better and by incentivizing honest work,” he said.

Lim noted that Malaysia needs more private investment in high-value areas that could unlock greater productivity growth.

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