PETALING JAYA:The Asian Development Bank (ADB) has revised Malaysia’s 2021 growth forecast down from 6% to 5.5%, citing lockdown measures aimed at stemming the Covid-19 pandemic.
The 6% forecast was made in April prior to the government’s announcement of a “total lockdown”. The restrictions have been eased in some states over the past two weeks.
In its Asian Development Outlook 2021 released today, ADB noted that Malaysia posted a smaller GDP decline of 0.5% year-on-year in Q1 this year, with improvement in domestic demand and exports, particularly in the electronics and electrical sector.
“However, an extension of lockdown measures imposed in Q2 2021 is expected to weaken domestic demand again,” it said in the report.
“Business conditions for manufacturers deteriorated sharply in June under stricter containment measures.
“Greater downside risks are likely as rising infections show no sign of abating.”
ADB, however, maintained Malaysia’s GDP forecast for 2022 at 5.7%.
ADB said that its forecast for Southeast Asian growth in 2021 has been downgraded from 4.4% to 4.0% as some countries reimpose pandemic restrictions, adding that it expects growth to bounce back to 5.2% in 2022. - FMT
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