KUALA LUMPUR: Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz has played down concerns about a recession in Malaysia, saying that the government, however, is ready to face any eventualities including a global recession.
"We have gone through global recessions before this and we need to be sure that the government and people are also ready for any eventualities. But today, the focus is still very optimistic that the country will continue to record a positive growth this year," he told reporters at the launch of the Employees Provident Fund's i-Lindung insurance initiative here today.
Tengku Zafrul said Malaysia had seen strong preliminary growth numbers for ther second quarter of 2022, adding that the government was expecting positive full-year expansion in gross domestic product (GDP) this year due to the reopening of the economy.
"Todate, the data is showing that Malaysia will continue to be on track to see a 5.3-6.3 per cent growth this year. We have factored it into the slowdown in the United States economy. Before that our target was 5.5-6.5 per cent.
"But having said that, things are very fluid. As a trading nation and a small open economy as well, we need to also monitor the growth globally," he added.
Malaysia's GDP grew 5.0 per cent in the first three months. Some economists have expected the pace to be faster in the second quarter, possibly at more than 6.0 per cent, before slowing in the remaining six months of the year.
Tengku Zafrul said the positive growth from retail and wholesale, oil and gas (O&G) and commodities would also help in the country's economic recovery this year.
He said Malaysia's wholesale and retail trade had set a new sales record in May, growing 19.9 per cent year-on-year (y-o-y) to RM129.8 billion.
"This is the highest sales recorded since 2013, according to the Department of Statistics Malaysia. We are confident that based on the data we have today, we are on track to achieve that forecasted growth for Malaysia.
"And this again has been validated by reputable international agencies like S&P Global Rating, which upgraded Malaysia's outlook rating recently. The International Monetary Fund (IMF) and the World Bank have also validated our growth figures," he added.
The head of the IMF last Wednesday said the outlook for the global economy had "darkened significantly" since April and she could not rule out a possible global recession next year given the elevated risks.
IMF managing director Kristalina Georgieva said the fund would downgrade in coming weeks its 2022 forecast for 3.6 per cent global economic growth for the third time this year.
The IMF is expected to release its updated forecast for 2022 and 2023 later this month, after slashing its forecast by nearly a full percentage point in April.
The global economy expanded 6.1 per cent in 2021.