Charting the sustainable fiscal and economic agenda
PETALING JAYA: The government's priority will continue to be placed on addressing leakages and enhancing efficiency through measures such as the phased implementation of the e-invoicing system moving forward.
The Fiscal Policy Committee (FPC) stated that these efforts underscored the government's resolve to build a fairer, more resilient and sustainable fiscal framework that supports long-term economic growth and the well-being of the rakyat.
The FPC convened yesterday to provide a comprehensive review of Malaysia's current economic developments, assess key external and domestic challenges, as well as analyse short and medium-term fiscal projections as outlined in the Public Finance and Fiscal Responsibility Act 2023 (FRA).
Prime Minister Datuk Seri Anwar Ibrahim, who chaired the meeting, stressed that the role of the FPC in shaping a balanced path between fiscal sustainability and economic growth is central to the government's commitment to sound fiscal governance, ensuring that the needs of the rakyat and businesses are met without compromising long-term stability.
He also noted that as the Madani government embarks on the 13th Malaysia Plan, fiscal space must be optimised to deliver public investments that materially transform the economy (Raise the Ceiling) and improve the rakyat's quality of life (Raise the Floor).
'The Madani government remains committed to pursuing fiscal sustainability while ensuring that growth momentum is preserved, particularly in light of current global developments.
'The Malaysian economy has continued to demonstrate resilience, expanding by 4.4% in the first half of 2025, while the unemployment rate eased to a decade low of 3%. In 2025, Malaysia's economy is expected to grow between 4% and 4.8%, underpinned by strong domestic demand, moderate inflation, and a stable labour market,' he said in a statement yesterday.
Anwar noted these outcomes were realised in tandem with the government's fiscal consolidation efforts, with the successful reduction of the fiscal deficit from 5.5% of gross domestic product in 2022 to 4.1% in 2024.
'The FPC meeting today reaffirmed the government's commitment to reducing the 3.8% fiscal deficit target for 2025 and subsequently achieving a deficit of 3% or below in the medium term,' he added.
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