Strong 8.7% GDP growth for 2022 shows restored confidence in national economy — Anwar

• This growth performance also far exceeds the 3.1% economic growth achieved in 2021.

KUALA LUMPUR (Feb 13): The strong gross domestic product (GDP) growth of 8.7% for 2022 shows the recovery of consumer, business and investor confidence in the national economy, said Prime Minister Datuk Seri Anwar Ibrahim, who is also finance minister.

Malaysia’s economy recorded an encouraging performance, with the GDP for 2022 recording 8.7%, exceeding the estimate of 6.5%-7% made in October 2022.

This growth performance also far exceeds the 3.1% economic growth achieved in 2021.

According to Anwar, the achievement of 8.7% growth for 2022 is supported by a strong economic performance in the fourth quarter of 2022 which, among other things, saw the recovery of private spending and investment, a decrease in unemployment and the strengthening of the ringgit.

“This clearly shows the recovery of consumer, business and investor confidence in the national economy,” he said in a statement through the Ministry of Finance (MOF) on Friday (Feb 10) night.

He said there are several economic indicators that have shown strong performance in the fourth quarter of 2022 (4Q2022), namely domestic demand continues to be driven by private consumption supported by better labour market prospects and business confidence that remains positive.

“The labour market maintains high employment levels with the unemployment rate decreasing to 3.6% in 4Q2022 compared with 3.7% in 3Q2022,” he said.

Ringgit getting stronger

He said the ringgit has strengthened by 5.3% against the US dollar and has also strengthened against the currencies of Malaysia’s main trading partners. Meanwhile, he said, foreign trade continued to record double-digit growth in addition to the encouraging performance of foreign direct investment (FDI).

“Total trade grew by 14.8% to RM718.7 billion with gross exports and imports increasing by 11.8% and 18.7% respectively.

“Malaysia recorded net FDI of RM19.3 billion in 4Q2022, compared with RM12.3 billion in 3Q2022,” he said.

The country's GDP growth is however expected to moderate in 2023, in line with the latest global economic outlook by the International Monetary Fund and the World Bank which estimates world economic growth to decrease from 3.4% in 2022 to 2.9% in 2023.

“With an increasingly challenging global economic environment, Budget 2023 will outline the government strategy to continue to support economic growth as well as private sector confidence to continue the growth momentum achieved in 2022 for the well-being of the people,” he added.

The Department of Statistics Malaysia, when announcing Malaysia's economic performance on Friday, said the 8.7% figure was the highest annual growth recorded in 22 years, which was contributed by improvements in all sectors.

In a separate statement, Bank Negara Malaysia said the country’s GDP grew by 7% in 4Q2022, compared with 14.2% in 3Q2022, following support from stimulus measures and the reduced low base effect.