Has the Malaysian economy been growing at a healthy rate?
An exchange among members of parliament yesterday has prompted experts to weigh in by saying a holistic look at the economy is needed instead of selective statistics.
Cherry picking data, they said, did not paint a full picture of Malaysia’s actual standing with the proper context.
Yesterday, Larut member of parliament (MP) Datuk Seri Hamzah Zainuddin claimed that the nation’s economy recorded the highest growth after 22 years in 2022 under Perikatan Nasional’s administration, when it grew 8.7 per cent, amongst the best in Southeast Asian countries.
Titiwangsa member of parliament (MP) Datuk Seri Johari Ghani soon lambasted the opposition leader’s claim as misleading, by cherry-picking the economic figures to suit their narrative.
Johari cited Malaysia’s economic growth of 3.1 per cent in 2021 was not sufficient to cover the 5.5 per cent shrink in 2020 while comparing the economic situation with neighbouring countries like Singapore and Indonesia.
“We should be aware that the circumstances in 2022 were exceptional. The pent-up demand post-Covid resulted in the surge,” said Malaysian Institute of Economic Research economist Dr Shankaran Nambiar.
“It is of course right to say that a growth of 3.1% in 2020 does not cover a contraction of 5.5% in 2022,” said Nambiar.
While acknowledging that GDP statistics cited by both MPs were all factually correct, Nambiar commented, “Hamzah was using statistics selectively and Johari provided perspective.”
Meanwhile, economic analyst Dr Barjoyai Bardai, a professor emeritus at Universiti Tun Abdul Razak told New Straits Times that Malaysia’s economy has shown a positive upward trend for 45 years till 2019.
“The Malaysian economy has grown in excellent pace over the last 45 years, for more than 6% on average until 2019, when we had a recession and then hit by the Covid-19 pandemic wave,” he said.
Dr Barjoyai acknowledged that during the recession period, the nation was still showing a relatively positive trend even if the growth folded into half from 2019 to 2022.
But, looking at the broader perspective, it is still a decreasing pattern.
“For the next three years (2019-2022), we were still growing on average at about 3% per annum and that is considered to be one of the best among the Asian nations, in fact, worldwide, including the worst time during the recession in 2020.”
“Yet, we shall not neglect the fact that there is a declining trend from an average of 6% to 3%.”
Dr Barjoyai is positive that Malaysia’s economy would keep thriving till 2026.
“The general economic trend in Malaysia is moving upward, and I am expecting that will continue for the next two or three years. By looking at the absolute figure, I am sure that we would exceed the peak of what we have achieved in 2019.”
However, he commented that the nation is in desperate need of a new economic boost.
“We may have reached a saturation point after growing so rapidly in the last 45 years. We need a boost now, and that would determine how Malaysia will be in the next decade,” he added.
Dr Barjoyai urged for a new initiative, as the country prepared to embrace the next economic recession.
“In 2026, we would see the economy slowing down after reaching a peak, then gradually moving into recession in 2029, hit rock bottom by end of 2029 or early 2030 till we recover.”
“This is a normal economic cycle. We cannot avoid that big grin, it will come.”
“If we have some solid initiative, we may be able to delay the decline in 2026,” he said.
Source: New Straits Times