Illustrative image (Photo: https://www.theedgemarkets.com/)Hanoi (VNA) – Penang, Malaysia’s technology hub, is helping drive aneconomic recovery that could see the country bounce back faster than any of itspeers in Southeast Asia, said experts.
The northern state drew 6.8 billion ringgit (1.6 billion USD) of foreign directinvestment in the first quarter, almost two-thirds of the country’s total. It attractednew projects even as the pandemic disrupted global supply chains and dampeneddemand worldwide. Approved investments in Penang in Q1 nearly doubled from theprevious three months, according to the InvestPenang investment promotionagency.
Wellian Wiranto, an economist at Oversea-ChineseBanking Corp. in Singapore, said that Malaysia plays akey role in the global semiconductor supply chain, and has benefited from thetentative recovery in the electronics cycle.
The Malaysiangovernment has announced nearly 70 billion USD in stimulus -- equal to about 20percent of GDP -- to cushion the effects of the pandemic. However, unemploymenthas surged to 5.3 percent, the highest since at least 1990.
Earlysigns of a rebound are evident in Malaysia’s exports, which climbed 8.8 percentfrom a year ago, driven by a 20-month high in electronics sales.
Analysts believe that Malaysia will overcome the difficultperiod caused by the COVID-19 pandemic better than most other countries inSoutheast Asia. The World Bank (WB) predicted that Malaysia's economy willdecrease by 3.1 percent in 2020 before increasing 6.9 percent in 2021.Meanwhile, the International Monetary Fund (IMF) projected that Malaysia’seconomy will shrink 3.8 percent this year before growing 6.3 percent next year.
FitchRatings said that the demand of Malaysia's middle class, making up 77 percent oftotal households, will help offset the decline in demand in overseas markets.CGS-CIMB believes that Malaysia's strong monetary and fiscal measures will helpits economy recover faster than other Southeast Asian countries./.
VNA
