MIER upgrades growth figures for 2006, 2007
Malaysiakini.com
Dec 6, 2006

A leading Malaysian forecaster has raised its 2006 economic growth projection to 5.9 percent and its 2007 forecast to 5.2 percent on the back of improved business and consumer confidence.

The influential Malaysian Institute of Economic Research (MIER) lifted its expectations from 5.6 percent for 2006 and 4.8 percent for 2007, figures which were released in October.

The independent think tank said the "goodies and incentives" under a national development plan to boost the economy had contributed to a better business environment.

Malaysia is rolling out a series of projects worth RM100 billion under its five-year Ninth Malaysia Plan.

MIER said Malaysia has grown less sensitive to the fortunes of the US economy but is becoming more sensitive to East Asian economies.

"What is becoming more important is East Asia, especially China," MIER's executive director Mohamed Ariff Abdul Kareem was quoted as saying by The Star newspaper Wednesday.

"Intra-trade with East Asian economies accounts for more than 50 percent of total trade in the region; Malaysia can ride on East Asian growth," Mohamed Ariff said.

Gov't gives robust picture

MIER expects Malaysia to achieve 5.5 percent growth in 2008 if the US dollar undergoes an orderly correction and oil prices remain stable if not lower.

Malaysia in 2004 posted GDP growth of 7.2 percent, its fastest pace in four years, but slowed to 5.2 percent in 2005.

The government has given a robust picture on Malaysia's prospects recently, saying it expects growth to exceed its projection of 5.8 percent for 2006, and reach 6.0 percent in 2007.

However, Fitch Ratings said last week that Malaysia's economic growth is likely to slow to 5.0 percent in 2007 from a projected 5.7 percent in 2006.

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