By TENGKU NOOR SHAMSIAH TENGKU ABDULLAH
KUALA LUMPUR, Sept 12 – Malaysia is poised for a robust economic performance in 2025, with a projected GDP growth of 5% to 6%, driven by macroeconomic stability, rising global commodity prices, and the nation’s strategic geographic positioning.
According to Shan Saeed, Global Chief Economist at Juwai IQI, the country’s economic fundamentals, supported by infrastructure investments and favorable currency trends, will keep Malaysia firmly on the radar of global investors.
He said Malaysia’s growth momentum remains solid, and it is only going to get stronger in the coming year.
In an exclusive interview at his office here Wednesday, Shan with 24 years of solid financial market experience, shared his bullish outlook for the nation, predicting that Malaysia’s GDP in 2025 will range between 5% and 6%, with the ringgit expected to strengthen, trading between RM 3.5 and RM 4 against the US dollar.
Key Drivers of Growth
Being the most sought after economist for his global macro economic thoughts, Shan attributes Malaysia’s promising outlook to several key factors:
1. Macroeconomic Stability
“Malaysia is benefiting from strong political, economic, and financial stability,” he noted. This stability, combined with favorable government policies and fiscal discipline, underpins Malaysia’s ability to maintain steady growth. He highlighted that the nation’s trade surplus and competitive exports will continue to attract foreign investment, particularly as global commodity prices rise.
2. Infrastructure as an Asset Class
Shan pointed out that infrastructure has become the new asset class for global investors, with Malaysia’s ongoing infrastructure projects acting as a critical driver of economic expansion. Drawing on insights from Nobel laureate Robert Fogel’s studies on the impact of infrastructure on GDP, the global chief economist emphasized the direct correlation between infrastructure investment and long-term economic growth.
3. Strategic Geographic Position
Malaysia’s strategic location near the Strait of Malacca—a crucial maritime route for global trade—further boosts its economic importance. Shan noted this positioning makes Malaysia an attractive hub for global investors, as the region accounts for a significant portion of the world’s oil and trade flows.
4. Rising Commodity Prices
Malaysia is well-positioned to benefit from higher global commodity prices, including oil, palm oil, and LNG, as the US dollar is expected to depreciate in the coming year. Shan projected oil prices to range between $83 and $127 per barrel, which will strengthen the Malaysian government’s fiscal balance and increase its ability to invest in the domestic economy.
Ringgit Outlook
He also expressed confidence in the ringgit’s outlook for 2025, predicting that the currency will trade between RM 3.5 and RM 4 against the US dollar. “As the US dollar depreciates, emerging market currencies, including the ringgit, will appreciate,” he explained. This appreciation will be bolstered by Malaysia’s economic strength, rising commodity prices, and continued trade surplus.
Strong Investor Sentiment
Global investor sentiment towards Malaysia remains positive, largely due to the country’s economic fundamentals and growth potential. Shan stressed that the combination of investment, consumption, and government support will be key drivers of this growth, ensuring that Malaysia remains an attractive destination for foreign capital.
“With strong consumption and investment levels, supported by government fiscal policies, Malaysia offers growth stability, which is exactly what investors are looking for,” Shan added.
The BRICS Factor
He also touched on Malaysia’s growing involvement with BRICS, an emerging economic bloc that he believes will become a significant force in the global economy over the next two to three years. He sees Malaysia’s participation as a positive move, positioning the country to benefit from expanding trade and investment opportunities within the BRICS network.
“BRICS is not a challenge to the US dollar, but it will operate in parallel. Malaysia’s growing economy will benefit from being part of this group,” he explained.
Conclusion: A Bullish Outlook
Looking ahead to 2025, Shan remains optimistic about Malaysia’s economic trajectory. With strong macroeconomic stability, rising global commodity prices, strategic infrastructure investments, and favorable currency trends, Malaysia is well-positioned to sustain robust economic growth.
“Juwai IQI is the first to project Malaysia’s GDP growth for 2025 at 5% to 6%, and we remain bullish on the country’s economic prospects,” Shan concluded.
TNS News