Budget 2019: Commentary from a global player

With the release of Malaysia’s new financial plan came some questions, so we solicited an economist to get his thoughts on Budget 2019.

“A growth-centric, austerity-driven, and people-focused budget”
– Shan Saeed (Chief Economist of IQI Global)

Shan Saeed, Chief Economist for IQI Global – a real estate brokerage – is cautiously optimistic, “The government has tabled the budget today hoping to maintain economic confidence to keep the growth trajectory moving. At IQI Global, we are cautiously optimistic with the new rolled out budget and foresee economic growth (GDP) meandering around 4.5 to 5 percent in 2019.

“The Government has clearly stated in the budget summary to have strategic focus on increasing Tax-to-GDP ratio with several incentives and measures. In my opinion, the most effective way to increase the tax-to-GDP ratio is by expanding the GDP size (Income level).

“The macroeconomic fundamentals of the country remain solid, and it seems this government can navigate through turbulent times effectively. Austerity is targeted to bring the debt-to-GDP ratio down to under 52 percent to help the government consolidate the fiscal side of things.

“The strategic intent of the government is a stronger balance sheet, positive GDP growth, lowering of debt-to-GDP ratio in order to provide relief to the masses. The government will support infrastructure investment on the MRT 2 and LRT 3 to spur growth and create an impact at the macro level – which is vital for the economic outlook.

“The government has planned to bolster the B40 group and increase the minimum wage to provide purchasing power and ability to the middle-income and lower-income groups. It is estimated that 4.1 million households will continue to receive financial assistance from the government with a total allocation of RM 5 billion. Minimum wage to go up to RM1,100 on Jan 1, 2019.

“This is the best government can do in the present circumstances taking into account the exogenous variables affecting most of the global economies like the trade war, Italian sovereign bond risk, Brexit uncertainty, geopolitical risk, a financial hurricane in equity and bond markets – and above all, sovereign currency depreciation is happening globally.”

Sourced from starproperty.my

Liked what you read? Check out this article next: Buying Your First Home on A Budget

Related posts

ALERT: IQI Does Not Operate “IQI List”

Hafiz Zainuddin

Join IQI! Comic Version

Hafiz Zainuddin

Perth house prices expected to increase 10 per cent in 2022

Hafiz Zainuddin