KUALA LUMPUR, Malaysia (June 29): According to HSBC co-head of Asian economic research Frederic Neumann, Malaysia is ideally positioned to recover from the Covid-19 outbreak in many ways. He stated in today’s HSBC Asian Outlook webinar that HSBC has established a 4.1 percent 2021 GDP growth projection forecast for Malaysia, which is lower than the World Bank’s 4.5 percent forecast, after recognizing the country’s recent issues that are limiting demand growth.
“However, we should emphasize that this is only a temporary stumbling block, and we expect Malaysia’s GDP to grow at 4.5 percent in 2022.”
Malaysia is attracting massive amounts of foreign direct investment (FDI), and it is in a unique position to capture the growing supply chains that are migrating to Southeast Asia.
“As a result, we see Malaysia as a structural success story in terms of grabbing manufacturing export market share,” Neumann added.
The Department of Statistics Malaysia (DOSM) announced on June 18 that FDI inflows into Malaysia have recovered, reaching RM9.1 billion in the first quarter of 2021 (1Q21), the highest level since the Covid-19 pandemic.
Malaysia’s top statistician, Datuk Seri Dr Mohd Uzir Mahidin, attributed the better investment to a stronger inflow of equity and investment fund shares, particularly in the industrial and services sectors, in an earlier statement.
Meanwhile, Frederic expects Malaysia to achieve herd immunity status by the beginning of next year.
“In terms of vaccine distribution timeline, Malaysia is actually ahead of its rivals.”
Yes, Malaysia is currently confronted with issues, but we feel that in the medium term, Malaysia has a fascinating tale to tell,” he said.
According to the most recent data from the Covid-19 Immunisation Task Force (CITF), 7.59 million Covid-19 vaccine doses had been provided across the country as of June 28, with 5.46 million initial doses and 2.13 million second doses.
The government has updated its targets upwards, according to National Covid-19 Immunisation Programme (PICK) Coordinating Minister Khairy Jamaluddin, to provide 300,000 doses per day in July and 400,000 doses per day in August.
As of yesterday, at least 16.7% of the population had received their first injection, and 6.5 percent had been fully infected (June 28).
Separately, the ringgit (RM) is currently one of Asia’s most undervalued currencies, according to HSBC global head of foreign exchange research Paul Mackel.
“RM is a commodity-oriented currency that trades at a low price. If the country can get past some of the immediate concerns regarding Covid-19, that might pave the way for a slow recovery,” he added. Continue reading
