Malaysia's economy grew 3.7% in 2023, the country's central bank said Friday, coming in below the target of 4% to 5% due to "prolonged weakness" of external demand. The annual result was far off the 8.7% pace recorded for the previous year. In the fourth quarter, gross domestic product growth slowed to 3.0%, from 3.3% the previous quarter. The fourth quarter performance was worse than the average 3.4% forecast in a Reuters poll of 23 economists published on Wednesday. "Growth moderated amid a challenging external environment," the central bank said. "This was due mainly to slower global trade, the global tech downcycle, geopolitical tensions and tighter monetary policies." In the fourth quarter, the services sector provided some momentum, growing 4.2%, while household spending continued to be supported by a better labor market and easing cost pressures. Private consumption growth came to 4.2% in the fourth quarter, down slightly from 4.6% in the previous quarter. Headline inflation continued to fall, coming in at 1.6% in the quarter, down from 2.0% in the third term, thanks in part to easing fresh food prices. On the whole, Malaysia's economic performance in 2023 was a tale of ups and downs. The first quarter saw 5.6% growth that exceeded expectations and placed the country among the region's leaders. But the second quarter saw the expansion slow to 2.9%, before a moderate rebound in the third quarter. Exports were lackluster, falling 8% for the year, as Malaysia struggled to find external demand for its electronics, palm oil and petroleum products. Overall trade was down 7.3% for 2023. The manufacturing sector managed just 0.8% growth from "continued weakness in the electrical and electronics industry." The sector contracted by 0.3% in the fourth quarter, from a decline of 0.1% previously. The actual fourth-quarter GDP growth came in lower than the advanced estimate of 3.4% released earlier by the Department of Statistics, noted Firdaos Rosli, chief economist at Ambank Group in Malaysia. "Although the unemployment rate has returned to its pre-pandemic levels, private consumption has also moderated steadily since economic reopening in 2022. I am also noticing a slowdown in business services and finance," Rosli said. He added that higher government spending was not able to boost private consumption, while investments were low at 1.7% year-on-year in the quarter. A bright spot toward the end of the year was the mining and quarrying sector, which grew 3.8% in the fourth period, after shrinking 0.1% in the previous quarter. Malaysia's government-owned state energy conglomerate, Petronas, last year found more than 1 billion barrels of oil in 19 discoveries. The oil and gas giant said more than half the discoveries were made off the coast of Sarawak, while three were found in the northwest of Sabah, in eastern Malaysia. The central bank, when it held its benchmark overnight policy rate steady at 3.00% percent last month, cited improving domestic demand and labor market conditions. In the past month, the ringgit has dropped by around 2.5% against the dollar, but the central bank stressed that the currency's weakness was primarily influenced by external factors and "not reflective of the current and domestic economic performance and prospects." The central bank projects that growth in 2024 will benefit from more resilient domestic spending and improvement in external demand, including for tech. The International Monetary Fund projects a rebound in global trade growth at 3.3% in 2024, from 0.4% in the previous year. (ICE KUALA LUMPUR)

Fonte notizia: 19 febbraio 2024, Kuala Lumpur