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Daily Express
05-05-2025
- Business
- Daily Express
Economy can withstand tariffs
Published on: Monday, May 05, 2025 Published on: Mon, May 05, 2025 By: David Thien Text Size: Dr Choy acknowledged that Malaysian consumer spending has dropped, accompanied with higher external demand, as Malaysia's manufacturing PMI declines by a margin. Kota Kinabalu: Sabah and Malaysia are not expected to be impacted drastically this year despite global economic uncertainty due to the tariff regime imposed by United States President Donald Trump. Growth rate is expected to be around 4.4 per cent. This is due to the strength of local economic activities, said Dr Roy Choy Swee Yew, the Chief Economist of MARC Ratings Berhad at the 'Economic & Market Outlook for 2025 and Beyond' session of the Sabah Renewable Energy Conference 2025 at Shangri-La Tanjung Aru Resort, recently. 'Sabah is the largest palm oil producer in Malaysia. Petroleum products and natural gas account for 50 per cent of Sabah's total exports,' Dr Choy said. He noted that currently, the high impact renewable energy projects in Sabah are the RM120 million Seguntor Bioenergy and the RM250 million Tadau Energy Solar Farm which is Malaysia's first green sukuk-financed renewable energy project. No economic crisis is seen for 2025, although the withdrawal of fuel subsidies later in the year may hike inflation temporarily for six months. Bank Negara is expected to maintain the OPR rate for this year, Dr Choy said. On the high impact infrastructure projects in Sabah include the RM40 billion Pan Borneo Highway and the RM7.5 billion Sabah–Sarawak Link Road (SSLR), he said. The high impact agriculture projects in Sabah include the RM33.59 million Land optimisation and Agro-Food Development and the activities under the Sabah Agricultural Blueprint 2021 – 2030. Dr Choy acknowledged that Malaysian consumer spending has dropped, accompanied with higher external demand, as Malaysia's manufacturing PMI declines by a margin. There is a broad-based increase in manufacturing exports. 'Domestic economic growth remains resilient despite a weaker external environment,' he said, adding that: 'Malaysia's inflation is expected to remain anchored following Trump's tariff announcements.' 'Central banks are adopting a more dovish stance, with plans to implement further interest rate cuts,' Dr Choy revealed. He foresees global economic growth is projected to reach 2.8 per cent in 2025, as global inflation is cooling. 'However, global trade flows and inflation dynamics remain vulnerable to U.S. tariffs. Trump's new tariffs also target the trade imbalance with Asean,' Dr Choy said, as Malaysia chairs the organisation this year. 'Financial market uncertainties rise amid heightened trade wars. Bond market retreated following the U.S. treasuries sell off as tariff hike on pause,' he said. Malaysia is going to introduce a carbon tax by 2026. 'Markets are pricing in a dovish Federal Reserve path, likely in response to expectations of slowing inflation and recession fears. Year-to-date, our ringgit has held up well. 'Persistent foreign outflows from Malaysia's bond and equity markets reflect waning investor confidence,' Dr Choy said. * Follow us on Instagram and join our Telegram and/or WhatsApp channel(s) for the latest news you don't want to miss. * Do you have access to the Daily Express e-paper and online exclusive news? Check out subscription plans available. Stay up-to-date by following Daily Express's Telegram channel. Daily Express Malaysia
Daily Express
26-04-2025
- Business
- Daily Express
Sarec 2025: Sabah's econ prospects robust
Published on: Saturday, April 26, 2025 Published on: Sat, Apr 26, 2025 By: Sisca Humphrey Text Size: Choy also pointed out that Sabah's median wage growth has outpaced the national trend — increasing from RM1,300 in 2013 to RM2,015 in 2022 — compared to the national rise from RM1,700 to RM2,424. Kota Kinabalu: Sabah's economic prospects remain robust despite global uncertainties and domestic challenges, said MARC Ratings Berhad Chief Economist Ray Choy See Yew during the Sabah Renewable Energy Conference (Sarec) 2025 here, on Thursday. Presenting on the theme 'Economic and Market Outlook for 2025 and Beyond', Choy said the outlook for the year ahead remains cautious, largely due to persistent global trade tensions. However, he assured that Malaysia's economy, driven predominantly by domestic demand, is well-positioned to weather external shocks. 'Malaysia's economy is essentially domestically driven. Approximately two-thirds of Gross Domestic Product (GDP) comes from internal demand, which offers a strong buffer against external shocks like trade wars,' he said. He also underlined the strength of Malaysia's diversified export base. While the United States (US) remains a key trade partner, no single country accounts for more than 10 percent of Malaysia's export-to-GDP ratio — a sign of the country's resilience in the face of global headwinds. 'Sabah's contribution to Malaysia's GDP, though vital, has slightly declined over the years, from 6 percent in 2013 to 5.3 percent in 2023,' he said. Despite this dip, Choy believes Sabah has substantial growth potential, especially in light of its GDP growth of just 1.3 percent in 2023 — below the national average of 3.7 percent. 'While Sabah continues to develop, there is still ample opportunity to improve and grow its economic output,' he said. He remarked that services, mining, and agriculture remain the backbone of the State economy, with ongoing diversification offering new pathways for development. Choy also pointed out that Sabah's median wage growth has outpaced the national trend — increasing from RM1,300 in 2013 to RM2,015 in 2022 — compared to the national rise from RM1,700 to RM2,424. 'Sabah's wage growth of 5 percent per annum is above the national average of 4 percent, indicating improving living standards in the State,' Choy said. While Sabah continues to lead the nation in palm oil production, challenges such as climate change and limited replanting have impacted output. 'However, palm oil continues to be a vital export, alongside petroleum products and natural gas, which together make up half of the State's total exports,' he added. Highlighting Sabah's future, Choy spoke of transformative projects set to diversify and stimulate the local economy — particularly in renewable energy, infrastructure, and agriculture. 'Key projects include Seguntor Bioenergy Sdn Bhd (RM80 million to RM120 million) and the Tadau Energy Solar Farm, Malaysia's first green sukuk-financed renewable energy initiative, valued at RM250 million. 'Renewable energy projects are central to Sabah's growth and offer exciting prospects for long-term economic stability,' he said. He also emphasised the strategic importance of major infrastructure initiatives such as the RM40 billion Pan Borneo Highway and the RM7.5 billion Sabah-Sarawak Link Road (SSLR). 'These infrastructure projects are pivotal for Sabah's future economic growth,' he said, adding that enhanced transportation networks will strengthen both local and regional development. Nationally, Choy projected a 4.4 percent GDP growth for Malaysia in this year, supported by stable inflation, steady foreign direct investment in semiconductors and data infrastructure and a resilient financial market. On the global front, he forecast 2.8 percent economic growth for the year, with inflation expected to ease. However, he warned that US tariffs and changing global trade dynamics could still pose risks — particularly for Asean economies. 'Trade war dynamics are constantly evolving and US tariffs could shift the economic landscape,' he said. Despite such challenges, he believed that Malaysia's diversified economy and Sabah's untapped potential will continue to support sustainable growth. 'Malaysia's economy benefits from diversified export markets and a resilient domestic economy,' he said. He asserted that Sabah has ample room to grow and with the right investment and policy framework, the State could play an even larger role in Malaysia's economic future. * Follow us on Instagram and join our Telegram and/or WhatsApp channel(s) for the latest news you don't want to miss. * Do you have access to the Daily Express e-paper and online exclusive news? Check out subscription plans available. Stay up-to-date by following Daily Express's Telegram channel. Daily Express Malaysia
Daily Express
26-04-2025
- Business
- Daily Express
Sabah's econ prospects robust: SAREC 2025
Published on: Saturday, April 26, 2025 Published on: Sat, Apr 26, 2025 By: Sisca Humphrey Text Size: Choy also pointed out that Sabah's median wage growth has outpaced the national trend — increasing from RM1,300 in 2013 to RM2,015 in 2022 — compared to the national rise from RM1,700 to RM2,424. Kota Kinabalu: Sabah's economic prospects remain robust despite global uncertainties and domestic challenges, said MARC Ratings Berhad Chief Economist Ray Choy See Yew during the Sabah Renewable Energy Conference (Sarec) 2025 here, on Thursday. Presenting on the theme 'Economic and Market Outlook for 2025 and Beyond', Choy said the outlook for the year ahead remains cautious, largely due to persistent global trade tensions. However, he assured that Malaysia's economy, driven predominantly by domestic demand, is well-positioned to weather external shocks. 'Malaysia's economy is essentially domestically driven. Approximately two-thirds of Gross Domestic Product (GDP) comes from internal demand, which offers a strong buffer against external shocks like trade wars,' he said. He also underlined the strength of Malaysia's diversified export base. While the United States (US) remains a key trade partner, no single country accounts for more than 10 percent of Malaysia's export-to-GDP ratio — a sign of the country's resilience in the face of global headwinds. 'Sabah's contribution to Malaysia's GDP, though vital, has slightly declined over the years, from 6 percent in 2013 to 5.3 percent in 2023,' he said. Despite this dip, Choy believes Sabah has substantial growth potential, especially in light of its GDP growth of just 1.3 percent in 2023 — below the national average of 3.7 percent. 'While Sabah continues to develop, there is still ample opportunity to improve and grow its economic output,' he said. He remarked that services, mining, and agriculture remain the backbone of the State economy, with ongoing diversification offering new pathways for development. Choy also pointed out that Sabah's median wage growth has outpaced the national trend — increasing from RM1,300 in 2013 to RM2,015 in 2022 — compared to the national rise from RM1,700 to RM2,424. 'Sabah's wage growth of 5 percent per annum is above the national average of 4 percent, indicating improving living standards in the State,' Choy said. While Sabah continues to lead the nation in palm oil production, challenges such as climate change and limited replanting have impacted output. 'However, palm oil continues to be a vital export, alongside petroleum products and natural gas, which together make up half of the State's total exports,' he added. Highlighting Sabah's future, Choy spoke of transformative projects set to diversify and stimulate the local economy — particularly in renewable energy, infrastructure, and agriculture. 'Key projects include Seguntor Bioenergy Sdn Bhd (RM80 million to RM120 million) and the Tadau Energy Solar Farm, Malaysia's first green sukuk-financed renewable energy initiative, valued at RM250 million. 'Renewable energy projects are central to Sabah's growth and offer exciting prospects for long-term economic stability,' he said. He also emphasised the strategic importance of major infrastructure initiatives such as the RM40 billion Pan Borneo Highway and the RM7.5 billion Sabah-Sarawak Link Road (SSLR). 'These infrastructure projects are pivotal for Sabah's future economic growth,' he said, adding that enhanced transportation networks will strengthen both local and regional development. Nationally, Choy projected a 4.4 percent GDP growth for Malaysia in this year, supported by stable inflation, steady foreign direct investment in semiconductors and data infrastructure and a resilient financial market. On the global front, he forecast 2.8 percent economic growth for the year, with inflation expected to ease. However, he warned that US tariffs and changing global trade dynamics could still pose risks — particularly for Asean economies. 'Trade war dynamics are constantly evolving and US tariffs could shift the economic landscape,' he said. Despite such challenges, he believed that Malaysia's diversified economy and Sabah's untapped potential will continue to support sustainable growth. 'Malaysia's economy benefits from diversified export markets and a resilient domestic economy,' he said. He asserted that Sabah has ample room to grow and with the right investment and policy framework, the State could play an even larger role in Malaysia's economic future. * Follow us on Instagram and join our Telegram and/or WhatsApp channel(s) for the latest news you don't want to miss. * Do you have access to the Daily Express e-paper and online exclusive news? Check out subscription plans available. Stay up-to-date by following Daily Express's Telegram channel. Daily Express Malaysia
