Shan Saeed Global chief economist at Juwai IQI sees synchronized macro stability positioning Malaysia as ASEAN’s premier investment destination
By TENGKU NOOR SHAMSIAH TENGKU ABDULLAH
KUALA LUMPUR – As Malaysia approaches 2026, the nation’s economic fundamentals are not merely holding steady—they are demonstrably strengthening, positioning the country as one of ASEAN’s premier investment destinations and a model of macroeconomic stability amid global uncertainty.
In an exclusive year-end interview with TNS News, Shan Saeed, Global Chief Economist at Juwai IQI, painted a compelling picture of an economy that has achieved what few emerging markets can claim: synchronized growth across all major economic pillars without triggering inflationary pressures or fiscal instability.
Rare Macro Equilibrium Achieved
“Malaysia enters 2026 with sovereign macro-fundamentals that are not merely intact but demonstrably strengthening,” Shan told TNS News. “It is one of the rare emerging economies where all four macro pillars—growth, inflation, external balances, and policy credibility—are aligned in a synchronous, constructive trajectory.”
This alignment, he emphasized, represents more than statistical coincidence. “Malaysia has engineered a rare macro equilibrium—stability without inertia, and growth without inflationary spillovers,” Shan said.
Robust Growth Projections
While Malaysia’s Ministry of Finance projects GDP growth of 4.0–4.5% for 2026, and S&P Global has upgraded its forecast to 4.5% based on semiconductor resilience and capital deepening, Shan offers a more optimistic outlook.
“My call: Malaysia’s GDP to meander between 4.5% and 5.5% in 2026,” he stated confidently, noting that this would place Malaysia significantly ahead of the projected world GDP growth of 3.1% and within ASEAN’s upper echelon of growth prospects.
Supporting this optimistic projection is what Shana describes as “one of the largest multi-year investment waves in Malaysia’s economic history.”
“RM378.5 billion in 2024 plus RM285.2 billion in the first nine months of 2025 equals RM663 billion in catalytic capital,” he explained. “This committed capital is now metastasizing into real economic capacity: new plants, expanded industrial clusters, precision-manufacturing corridors, and reconfigured supply chains.”
Inflation Under Control
One of Malaysia’s most significant competitive advantages heading into 2026, according to Shan, is its exceptionally low inflation profile.
“Malaysia’s inflation is one of ASEAN’s lowest at 1.5–2.3%, reflecting Bank Negara’s prudent, data-sensitive monetary governance,” he told TNS News. “This CPI anchor is supported by stable food prices, well-sequenced subsidy rationalization, and rising consumer purchasing power.”
This low-inflation environment, Shan emphasized, is “a strategic differentiator” that gives Malaysia “a domestic-demand engine that can expand without destabilizing prices—a sovereign advantage in an era of global inflationary turbulence.”
Strong External Position
Malaysia’s external sector continues to provide what Shan describes as “an under-appreciated sovereign asset.”
The country maintains a steady current account surplus of 1.5–2.5% of GDP, he noted, “underwritten by a robust goods surplus and surging services exports.”
“The goods surplus is driven by electronics and electrical products, LNG, petrochemicals, and refined palm derivatives,” Saeed explained. “Meanwhile, we’re seeing a services upswing in digital exports, data-centre services, aviation, and tourism reaching new peaks.”
This external configuration, he told TNS News, “functions as a macroeconomic shock absorber, reinforcing Malaysia’s appeal to long-duration institutional, pension, and sovereign investors.”
Ringgit Outlook: Gradual Appreciation
For the Malaysian Ringgit, Saeed projects a “constructively biased trajectory” in 2026, with the currency “structurally supported and cyclically undervalued.”
“The ringgit enters 2026 within the RM3.90–4.25 per USD range, with strong undertones of stability,” he said, identifying several upside catalysts including US Federal Reserve rate cuts, stable oil prices, sustained FDI inflows, and Malaysia’s persistent current account surplus.
Based on Malaysia’s sovereign fundamentals and market microstructure, Saeed estimates the intrinsic fair market value at “RM4.05–RM4.20 per USD, indicating the Ringgit remains structurally stable.”
High-Impact Sectors Driving Growth
Shan identified several key sectors that will power Malaysia’s economic expansion in 2026:
Semiconductors & Advanced Electronics
“Malaysia is leveraging its global dominance in test, assembly, and engineering precision,” he said, noting this sector’s central role in the investment supercycle.
Data Centres & Digital Infrastructure
“Malaysia is transforming into ASEAN’s digital nerve centre,” Shan told TNS News, highlighting the billions being invested in hyperscale data center facilities.
EV Components & Precision Manufacturing
The economist pointed to Malaysia’s success in “capturing global relocation flows” as companies diversify supply chains.
Green Energy & Decarbonisation
“Malaysia is constructing the backbone of its industrial transition,” Shan said, emphasizing the country’s strategic pivot toward hydrogen, solar, and carbon-neutral industrial ecosystems.
“The net result,” he concluded, “is that Malaysia consolidates its role as ASEAN’s premier manufacturing, digital, and energy-transition hub firmly on the global investor’s radar.”
Commodity Outlook and Energy Transition
Malaysia continues to benefit from its commodity endowments while simultaneously transitioning to green energy, Shan noted.
For 2026, he projects Brent crude at USD 73–87 per barrel, crude palm oil at RM3,900–4,300 per metric ton, and resilient LNG demand from North Asia.
Notably, Shan also forecasts gold prices reaching USD 5,200–6,000, “reflecting global bifurcation and central-bank accumulation reminiscent of the 1976–1980 gold cycle.”
“Malaysia is orchestrating a seamless pivot leveraging commodities while constructing a hydrogen, solar, and carbon-neutral industrial ecosystem,” he said.
Trump Tariffs: Malaysia’s Strategic Advantage
While global trade tensions and potential Trump administration tariffs inject friction into the global economy, Saeed sees Malaysia as “structurally advantaged.”
“Malaysia is widely seen as a neutral, rules-based, high-trust jurisdiction ideal for supply-chain diversification away from geopolitical pressure points,” he told TNS News.
He identified semiconductors, industrial automation, data centres, specialty chemicals, and EV components as key sectors likely to benefit from supply chain realignment in 2026.
“Malaysia’s institutional trust, regulatory predictability, and intellectual-property protection give it a premium in global relocation calculus,” Shan explained.
Capital Flows and Regional Competition
When asked about Malaysia’s competitive position within ASEAN, Saeed was emphatic about the country’s advantages.
“Investors entering 2026 seek three qualities Malaysia offers in abundance: stability, predictability, and upside potential,” he said.
He elaborated: “Low inflation, disciplined fiscal posture, and credible monetary policy form a rare macro trifecta. Bank Negara’s data-anchored stance reinforces Malaysia as ASEAN’s most policy-reliable jurisdiction. And Malaysia’s investment pipeline is structural, durable, and high-multiplier.”
Comparing Malaysia to regional competitors, Shan noted the country is “outpacing Thailand, which faces policy inertia, and is more stable than Vietnam, which has financial-sector vulnerabilities.”
“Malaysia emerges as the premium macro story in ASEAN for long-horizon capital,” he concluded.
ASEAN Leadership and Regional Integration
Malaysia’s 2025 ASEAN chairmanship has enhanced the country’s regional profile, according to Shan.
“Malaysia’s ASEAN chairmanship in 2025 enhanced its visibility in digital governance, supply-chain harmonization, local-currency settlements, and regional investment facilitation,” he said.
“In 2026, Malaysia remains a central node in ASEAN’s economic architecture, shaping norms and attracting multinational capital.”
Strategic Priorities for the Next Five Years
Looking beyond 2026, Shan outlined three national imperatives for Malaysia’s continued success:
Build the “Next Malaysia” Industrial Base
“Semiconductors, AI hardware, aerospace, EV ecosystems, hydrogen, and green-tech manufacturing,” he enumerated, emphasizing the need to move beyond traditional manufacturing.
Fortify Sovereign Macro-Fundamentals
“Enhance fiscal capacity, widen revenue bases, deepen foreign exchange buffers, modernize regulations,” Shan advised.
Position as ASEAN’s Capital, Innovation & Energy-Transition Hub
“A jurisdiction where global firms build the industries of tomorrow—not merely assemble those of yesterday,” he said.
Domestic Resilience: The Consumer Advantage
Malaysia’s domestic economy remains robust, supported by what Shan calls “a competitive sovereign advantage.”
“Malaysia’s inflation profile is a strategic differentiator,” he told TNS News, pointing to stable food prices, well-managed subsidy reforms, and rising consumer purchasing power.
“Rising disposable incomes, a stable labour market, predictable inflation, and an expanding middle class” are powering domestic demand, he noted, adding that “Malaysia’s domestic engine remains broad-based, energy-rich, and structurally sound.”
Final Assessment: Structurally Primed for Growth
Summarizing Malaysia’s position as 2026 approaches, Shan offered an unequivocally positive assessment.
“Malaysia enters 2026 with sovereign stability, strategic momentum, and investment depth—an economy not merely resilient, but structurally primed for a decade of sustained, high-quality growth,” he told TNS News.
He emphasized that this optimistic outlook is grounded in measurable fundamentals, not speculation. “What the data confirms is a Malaysia where growth dynamics are built for resilience, where external balances provide shock absorption, where inflation remains under control, and where policy credibility attracts patient, long-term capital.”
“In an era punctuated by global uncertainty,” Shan concluded, “Malaysia’s macro fundamentals stand as a bastion of clarity and predictability. The country has not just weathered recent global storms—it has positioned itself to capture the opportunities that turbulence creates for well-managed economies.”
As Malaysia enters what Shan characterizes as a “year of sovereign macro stability, strategic momentum, and investment maturity,” the country appears poised to deliver on the promise of Vision 2025 while laying the groundwork for continued prosperity through the decade ahead.
About the Expert: Shan Saeed is Global Chief Economist at Juwai IQI, a leading property technology group operating across Asia, the Middle East, and beyond. He specializes in macroeconomic analysis, monetary policy, emerging market dynamics, and sovereign risk assessment.
- TNS NEWS