Malaysia likely to project budget deficit of 2.9 percent of GDP in 2018 - OCBC

The Malaysian 2018 budget “Shaping the Future” is set to be announced at the end of this month, before the nation’s general election that is to be held before 24 August 2018. According to the OCBC Treasury Research, Malaysia is on its path to achieve its target of -3 percent budget balance as percent of GDP in 2017.

The narrowing budget deficit is seen on the back of higher revenue, led by GST receipts and higher export duties. Therefore, the higher revenue is able to cushion the comparatively higher expenditure. The budget, into 2018, is likely to address the increasing cost of living via several targeted incentives for middle-low income groups via its BR1M program.

Other social policies might also revolve around the budget theme that would probably focus on education & training, improving healthcare standards and affordable housing, stated OCBC Treasury Research.

“All-in-all, we expect Malaysia to project a budget deficit of 2.9 percent of GDP in 2018, from an estimated of 3.0 percent in 2017”, added OCBC Treasury Research.

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