Page 121 - Malaysia 2016
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2016 121
demand (2015: 5.1%, 2014: 5.9%). On the supply side, all major economic
Domestic demand was primarily sectors registered more moderate
driven by the private sector. Modest growth, with the exception of the mining
improvements in external demand sector. The moderation reflected the
in the second half of the year also slower expansion of activity in industries
provided additional impetus to catering to domestic demand. However,
economic growth. export-oriented manufacturing and
trade-related services benefited from
Private consumption continued to the modest improvement in external
expand, albeit at a more moderate demand. Labour market conditions
pace as households adjusted their remained broadly stable in 2015 as
spending to the higher cost of living demand for labour was sustained by
arising from the implementation the continued expansion across all
of Goods and Services Tax (GST), economic sectors. While the labour
adjustments in administrative prices, force participation rate was stable at
and the depreciation in the ringgit. 67.6% (2014: 67.5%), the unemployment
Nevertheless, households received rate edged higher to 3.2% (2014: 2.9%)
some support from the higher cash as more cautious business sentiments
transfers under the Bantuan Rakyat led to softer employment prospects
1Malaysia (BR1M) scheme, the towards the second half of the year.
reduction in individual income tax
rates for the 2015 assessment year and Headline inflation declined to 2.1%
savings derived from lower domestic in 2015 (2014: 3.2%) as the impact of
fuel prices during the year. Household lower global energy and commodity
spending was also supported by prices more than offset the effects
continued income growth and stable from a weaker ringgit exchange rate,
labour market conditions. Public the implementation of GST and several
consumption recorded a sustained upward adjustments in administered
growth of 4.3% in 2015 (2014: 4.4%), prices. Despite the lower level of
reflecting the continued efforts by the inflation during the year, price increases
Government to provide support to were more pervasive due to the
growth, while remaining committed to implementation of GST, the weakening
the steady reduction in the fiscal deficit. of the ringgit and the higher prices for
fresh food. Headline inflation was also
Gross fixed capital formation (GFCF) relatively more volatile in 2015 reflecting
grew by 3.7% in 2015 (2014: 4.8%) a series of adjustments in domestic
mainly due to slower growth in private fuel prices. Nevertheless, core inflation
sector investment. During the year, the excluding GST remained stable at 2.3%
expansion in private investment was during the year (2014: 2.3%). The stability
lower at 6.4% (2014: 11.0%), reflecting of core inflation was a reflection of the
the moderation in domestic demand more moderate domestic demand
and cautious business sentiments. conditions, the absence of excessive
While investment in new oil and gas wage growth and the benign inflation
explorations moderated, overall private globally.
investment continued to be supported
by downstream oil and gas activities, Malaysia’s external position remained
and new and on-going projects in the resilient in 2015 despite the greater
manufacturing and services sectors. uncertainties in the global economy.
Public investment improved to register While the current account surplus
a smaller contraction of -1.0% (2014: narrowed during the year, it remained
-4.7%) as the Federal Government supported by a sizeable trade surplus
and public corporations continued of RM94.6 billion (2014: RM82.5 billion).
to undertake capital spending, thus For the year as a whole, growth in
providing support to the economy. exports and imports moderated to 1.9%
demand (2015: 5.1%, 2014: 5.9%). On the supply side, all major economic
Domestic demand was primarily sectors registered more moderate
driven by the private sector. Modest growth, with the exception of the mining
improvements in external demand sector. The moderation reflected the
in the second half of the year also slower expansion of activity in industries
provided additional impetus to catering to domestic demand. However,
economic growth. export-oriented manufacturing and
trade-related services benefited from
Private consumption continued to the modest improvement in external
expand, albeit at a more moderate demand. Labour market conditions
pace as households adjusted their remained broadly stable in 2015 as
spending to the higher cost of living demand for labour was sustained by
arising from the implementation the continued expansion across all
of Goods and Services Tax (GST), economic sectors. While the labour
adjustments in administrative prices, force participation rate was stable at
and the depreciation in the ringgit. 67.6% (2014: 67.5%), the unemployment
Nevertheless, households received rate edged higher to 3.2% (2014: 2.9%)
some support from the higher cash as more cautious business sentiments
transfers under the Bantuan Rakyat led to softer employment prospects
1Malaysia (BR1M) scheme, the towards the second half of the year.
reduction in individual income tax
rates for the 2015 assessment year and Headline inflation declined to 2.1%
savings derived from lower domestic in 2015 (2014: 3.2%) as the impact of
fuel prices during the year. Household lower global energy and commodity
spending was also supported by prices more than offset the effects
continued income growth and stable from a weaker ringgit exchange rate,
labour market conditions. Public the implementation of GST and several
consumption recorded a sustained upward adjustments in administered
growth of 4.3% in 2015 (2014: 4.4%), prices. Despite the lower level of
reflecting the continued efforts by the inflation during the year, price increases
Government to provide support to were more pervasive due to the
growth, while remaining committed to implementation of GST, the weakening
the steady reduction in the fiscal deficit. of the ringgit and the higher prices for
fresh food. Headline inflation was also
Gross fixed capital formation (GFCF) relatively more volatile in 2015 reflecting
grew by 3.7% in 2015 (2014: 4.8%) a series of adjustments in domestic
mainly due to slower growth in private fuel prices. Nevertheless, core inflation
sector investment. During the year, the excluding GST remained stable at 2.3%
expansion in private investment was during the year (2014: 2.3%). The stability
lower at 6.4% (2014: 11.0%), reflecting of core inflation was a reflection of the
the moderation in domestic demand more moderate domestic demand
and cautious business sentiments. conditions, the absence of excessive
While investment in new oil and gas wage growth and the benign inflation
explorations moderated, overall private globally.
investment continued to be supported
by downstream oil and gas activities, Malaysia’s external position remained
and new and on-going projects in the resilient in 2015 despite the greater
manufacturing and services sectors. uncertainties in the global economy.
Public investment improved to register While the current account surplus
a smaller contraction of -1.0% (2014: narrowed during the year, it remained
-4.7%) as the Federal Government supported by a sizeable trade surplus
and public corporations continued of RM94.6 billion (2014: RM82.5 billion).
to undertake capital spending, thus For the year as a whole, growth in
providing support to the economy. exports and imports moderated to 1.9%
