Malaysian Economic Summit 2018

Published on 16 Oct 2018

Whither Economic Growth, Towards Sustainable Productivity

Proceeding Report from discussions on 16th October 2018
at Royale Chulan Hotel Kuala Lumpur

Key points

• The Malaysian government must continue to practice fiscal discipline and be clear of its policy objectives to strengthen market confidence
• Drastic cuts on expenditure in the government’s effort to reduce government debt may run the risk of creating external shocks. Cost cutting on development expenditure needs to be carefully considered as it is needed for GDP growth. Instead, there should be more cuts on operational expenditure
• To bring about overall national development, there needs to be added focus on addressing inequality and poverty. Higher participation of women in the workforce will lead to greater national growth. This can be encouraged by enabling affordable access to childcare and elderly care, especially among low-income communities
• The introduction of new taxes has to be conducted with caution and more study is necessary to assess its overall impact to avoid adversely affecting market confidence
• High debt-to-GDP ratio needs to be addressed, perhaps through austerity measures to reenable higher growth, but this needs to the consideration of all policy options
• High levels of household debt is a major threat towards Malaysia’s long-term growth prospects. Young Malaysians need to develop good spending and saving habits. The government must find ways to increase income and reduce cost of living, such as in the area of healthcare, child support, transport, and the provision of affordable housing
• Malaysia should rectify the ICERD and have stronger policy commitments towards the SDGs
• With the loss of revenue from GST and unreliable oil prices, new revenue sources need to be found