PETALING JAYA – Malaysia’s economic outlook for 2024 is set for expansion and growth, subject to the government’s effectiveness in executing its domestic policies, foreign investment, and governance structures.
Real Estate and Housing Developers Association Malaysia (Rehda) Institute chairman Datuk Jeffrey Ng Tiong Lip said policies that foster innovation, incentives that attract quality global investments, and assurance of inclusive development will contribute positively to Malaysia’s economic outlook.
“We find ourselves at a critical juncture in Malaysia’s economic landscape, amidst the background of an external world market impacted by geopolitical uncertainties.
“The global economy is expected to slow slightly in 2024 as concerns remain over high levels of debt and uncertainties over interest rates.
“Monetary policies, interest rates, and the overall health of financial institutions will impact investment patterns, access to capital, and the cost of doing business in Malaysia,” he said during his opening keynote address during Rehda’s annual CEO Series 2023 (Economy & Business Forum) held at the Le Meridien Hotel, here, today.
Malaysia’s GDP growth next year is forecast to range between 4% and 5%, compared to 4% for this year, according to Bank Negara.
Despite the bleak outlook on the global economy, which also influences the country’s economic outlook, Ng was hopeful about efforts by Prime Minister Datuk Seri Anwar Ibrahim to bring investments into the country from all over the world, especially China.
“In 2024, it will mark the 50th year of bilateral diplomatic relations between China and Malaysia, where there will be substantial visits and activities between both nations.”
Growth potential in Johor-Singapore special economic zone
Ng also highlighted key economic growth opportunities in the country through numerous developments between Johor and neighbouring Singapore.
“The establishment of a special economic zone (SEZ) in Johor will likely stimulate job creation.
“Currently, approximately 900,000 Malaysians work in Singapore, where around one-third (300,000) Malaysians travel across the Johor-Singapore Causeway on a daily basis.
“Many of them work in Singapore, lured by favourable exchange rates.
“The SEZ could contribute to better job opportunities in the Johor region, where some Malaysians could be employed in our own country.
“Some of these jobs could be in the industrial and manufacturing sectors, research and development sectors, service sector employment etc,” he said.
The establishment of the SEZ, he said, may stimulate infrastructure development in the region, including transportation, utilities, and communication networks, creating positive spillover effects on the overall economic development of the area, which also includes the controversial Forest City development by Country Garden.
“Other than the current RTS Link Project (Woodlands in Singapore to Bukit Chagar in Johor Bahru), which is expected to have a capacity of 10,000 passengers per hour, per direction, with an approximate ridership of 40,000 passengers per day, it is believed that if the authorities decide to revive the High-Speed Railway or pursue additional crossing avenues (such as ferry crossings or even a third link bridge), this would create further positive effects.”
Likening the upcoming Johor-Singapore SEZ to the now-successful Shenzhen-Hong Kong model, Ng expressed hope of seeing similar medium- and long-term future potential growth in Johor under the leadership of the present government.
“For context, in 1980, when Shenzhen was announced as China’s first special economic zone, it was originally a small village with approximately 330,000 residents.
“Comparatively, four decades later, in 2022, Shenzhen’s permanent resident population will be approximately 17 million and its GDP will be 3.24 trillion yuan (US$475 billion or approximately RM2.2 trillion),” he said.
Challenges to construction industry
Lim also hoped that the government would consider the plight of the construction and property development sectors due to the increase in the price of building materials.
“The increase poses a serious challenge to the construction and property development industries (for instance and price, ready-mixed concrete price, rising cost of logistics, labour, and supply of workers) and has a spillover effect on the rest of the supply chain.” he said.
He added that Malaysia’s economic trajectory, from the early days of industrialisation to the present era of digital transformation, has consistently demonstrated the spirit of progress.
“Businesses need to adapt to demographic composition changes within Malaysia that impact consumer behaviour, workforce dynamics, and overall economic demand.
“As we look ahead to 2024, understanding and adapting to shifts in demographics, such as an ageing population or changes in consumer preferences, will be integral to sustaining economic growth,” he said. – December 7, 2023