Malaysia to see strong recovery in 2022: Fitch Solutions – Macau Business

Fitch Solutions Country Risk and Industry Research said Monday it still forecast Malaysias real gross domestic product (GDP) growth of 1.5 percent and 5.5 percent in 2021 and 2022, respectively, following the release of the countrys third quarter growth.

The Fitch group unit said in a note, while Malaysias economy contracted 3.6 percent on a quarter-on-quarter basis, tipping the country into a technical recession, it expects the technical recession to end in the fourth quarter, which should post positive growth on the back of broad-based, lifting of restrictions for fully vaccinated individuals.

In addition to the fourth quarter recovery, the research house said the countrys economy should be much more resilient against COVID-19 in 2022, given higher vaccination rates and the improved resistance among the population conferred by the severe wave of infections experienced in 2021.

Domestic demand will likely see a strong recovery as a result, with private consumption in particular, benefitting from the lifting of restrictions, it said.

It also said, the fixed investment of Malaysia will receive a further boost from the ongoing global chip shortage and government consumption will be supported by a highly expansionary budget.

Net exports should also contribute positively once more to headline growth, despite mixed risks, it added.

Last Friday, Malaysia announced that its GDP contracted by 4.5 percent year on year in the third quarter of 2021, dragged by strict containment measures implemented by the government to curb the pandemic.

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Malaysia to see strong recovery in 2022: Fitch Solutions - Macau Business