KUALA LUMPUR: The government is on the right track to put Malaysia back on its fiscal path and revive the economy in its three-year financial roadmap, Finance Minister Lim Guan Eng said.
Lim said many of the measures from 2020 Budget were designed to optimise short-term support for growth, and at the same time balance the need to remain on a fiscal consolidation path.
“The fiscal target is revised to 3.2 per cent of GDP in 2020 from 3.0 per cent previously, but it remains on track to reach 2.8 per cent in the medium term.
“The increase from 3.0 per cent to 3.2 per cent might not sound a lot, but remember, when it comes to spending, it is not only about how much is spent but also on what the spending is on,” Lim said at the 2020 Budget Forum, here today.
He said many of the budget measures will not only help short-term growth, but will also ferment the foundations required to turn Malaysia structurally in the decades ahead.
He added that the measures were not only in line with the recently-launched Shared Prosperity Vision 2030, but also captures the spirit of the earlier Vision 2020 to transform Malaysia into a developed economy.
“Incentivising businesses and attracting foreign investment with incentives valued at RM10 billion over 10 years, together with the RM6.5 billion job creation programme which creates 350,000 jobs, will put Malaysians back to work and back in business.
“The 2020 Budget I tabled last week outlines the policy direction this government is taking. My message is simple: Malaysia is reindustrialising by digitalising our economy, by integrating with the global supply chain better and by incentivising honest work,” he added.
Lim said Malaysia needed more private investment in high-value areas that could unlock greater productivity growth.
This was the reason behind 2020 Budget’s first push, which seeks to draw high-quality foreign direct investment (FDI) from global unicorns and Fortune 500 companies, with opportunities worth RM5 billion over five years.
“These FDIs can create 150,000 high quality jobs to enrich Malaysia’s supply chain by making it more sophisticated in order to handle the production of high-value goods and services.
“Concurrently, we are upgrading Malaysia’s most promising companies to become regional and global champions in exports through incentives valued at RM5 billion over five years. These local companies are able to expand the export market can create 100,000 jobs locally,” he added.