KUALA LUMPUR: The Malaysian economy will remain resilient next year, with real gross domestic product (GDP) expanding between 5 and 5.5 per cent.
This will be led by domestic demand, according to the Economic Report 2017/2018.
Private sector expenditure will continue to be the main driver of growth with private investment and consumption growing 8.9 per cent and 6.8 per cent respectively.
Public sector expenditure is forecast to decline in line with lower capital outlays by public corporations.
On the supply side, growth is expected to broad-based, with all sectors registering positive growth.
The external position is likely to remain favourable supported by global growth and trade.
Against this backdrop, the nominal Gross National Income per capita is likely to rise by 5.1 per cent to RM42,777 in 2018 from RM40,713 in 2017.
The report said with investment growing at a faster pace, the savings-investment gap will narrow to 2.3 per cent of gross national income (GNI).
The economy will continue to operate under conditions of full employment with an unemployment rate of below 4 per cent, while inflation remains benign.
In line with the fiscal consolidation strategy, the fiscal deficit will further decline to 2.8 per cent of GDP in 2018.
The federal government debt will remain sustainable, with the prudent limit of 55 per cent of GDP.
With stronger fundamentals, the economy will be more resilient to propel the country towards advanced and high-income nation by 2020, doubling the economy to RM2 trillion in 2025 and joining the ranks of top 20 countries by 2050.