Economic | malaysian economic growth of 4. 9% predicted for 2025

Malaysian economic growth of 4.9% predicted for 2025

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Malaysia’s economic growth is expected to moderate to 4.9% this year, in line with the official target range of 4.5% to 5.5%, taking into account the impact of domestic policies and external challenges, the KSI Strategic Institute for Asia Pacific (KSI) has predicted.

The independent think tank noted that the global economy faces uncertainty as US President-Elect Donald Trump is set to start his second term by introducing trade tariffs.

“Nevertheless, domestic demand will remain the primary driver of growth. Private consumption will be supported by a stable labour market, a 7%–15% increase in civil service pay and revisions to the minimum wage.

“Private investment will benefit from the spillover effects of ongoing approved investments and a favourable financing environment,” it said in its Economic Report, End of Year 2024.

For 2024, KSI forecasts GDP growth of 5.2%.

Public investment is expected to moderate in 2025, given the flat development budget allocation compared with 2024.

Ongoing infrastructure projects and the launch of the GEAR-UP programme, amounting to RM25 billion (£4.25 billion) in 2025, along with government-linked investment companies (GLICs) and government-linked companies (GLCs) committing RM120 billion in domestic direct investment (DDI) over the next five years, should support government investment activities.

Public consumption is expected to grow faster, reflecting increased operating expenditure from Budget 2025, it added.

Regarding the labour market, the unemployment rate is projected to reach 3.2% by the end of 2025, supported by job creation driven by healthy domestic demand and ongoing investments.

The gig economy, accounting for 18.5% of the workforce or 3.1 million people as of October 2024, is expected to continue its growth, fuelled by advancements in digitalisation and shifting workforce preferences.

The residential property market showed strong performance in the first half of 2024, with the total number and value of residential property transactions increasing by 6.1% and 10.4% year-on-year, respectively.

“Virtuous investment cycles will be the key theme in 2025,” it said.

Key drivers for the market and stock performance in 2025 are expected to include positive consumption spending, acceleration in infrastructure spending, structural reforms aimed at fiscal sustainability, state government economic initiatives, re-industrialisation, and AI-driven growth.

The market is also likely to be boosted by mergers and acquisitions in the banking and technology sectors.

And the ringgit is expected to appreciate if global oil prices remain high and Malaysia benefits from increased foreign investment and robust trade demand.

Malaysians now need ETA to enter UK

Travellers from 48 countries now need Electronic Travel Authorisation (ETA) to enter the United Kingdom. The regulation came into force on 8 January 2025.

“Malaysians travelling to the United Kingdom will be required to present an Electronic Travel Authorisation (ETA),” the Foreign Ministry confirmed in a statement at the end of 2024.

Other countries that require ETAs include Singapore, Japan, South Korea and the United States.

According to the UK government website, each ETA application costs £10 (RM56) which will allow multiple entries into the country. There will be no refunds.

Everyone travelling to the UK needs an ETA, including babies and children.

However, those with a visa or permission to live, work or study in the United Kingdom do not need an ETA.

The ETA is an advance travel permission required from foreign nationals who intend to visit or transit the UK without a visa.

The system, set out in the country’s Nationality and Borders Act 2022, operates using an online application whose information is checked against security databases.

If the UK’s Border Agency and other relevant agencies do not find adverse information about the applicant the travel authorisation is granted automatically.

However, those holding an ETA can’t:

  • stay in the UK for longer than six months.
  • do paid or unpaid work for a UK company or as a self-employed person, unless you are doing a permitted paid engagement or event or work on the Creative Worker visa concession.
  • claim benefits.
  • live in the UK through frequent or successive visits.
  • marry or register a civil partnership.