KUALA LUMPUR – Malaysia’s gross domestic product (GDP) is projected to grow by 6% in 2021, a more moderate pace than the previously estimated 6.7%, said the World Bank, reported Bernama.
It said the growth is expected to be supported by the gradual strengthening in domestic demand following the vaccine deployment beginning March 2021, as well as cautious improvements in external demand.
“The strength and timing of Malaysia’s economic recovery, however, will depend largely on the timely availability of an effective mass vaccination programme.
“The vaccination programme is expected to cover at least 30 per cent of the population by August 2021,” it said in the “Economic Update for East Asia and the Pacific — Uneven Recovery” report released today.
Nevertheless, the World Bank anticipated that in the medium term, output for the economy is unlikely to return to the pre-pandemic levels.
“The growth outlook is subject to considerable downside risks. On the external front, further delays in the implementation of vaccination programmes could lead to recurrent lockdowns in advanced economies and dampen global growth.
“Upside risks include a successful mitigation of the third wave (of infections) and an effective roll-out and implementation of vaccination programmes, which could lead to a faster than expected recovery in domestic demand and greater investor confidence,” it said.
Meanwhile, the World Bank said the number of Malaysians living below the national poverty line is projected to decrease gradually and remain at pre-pandemic levels until 2022.
“This projection is predicated on the assumption that recovery in household employment and incomes is likely to be uneven, with tourism and other high-contact service occupations expected to be among the slowest to improve.
“The projection is also contingent upon a substantial rebound in employment and continued government relief measures to protect poor and vulnerable households, pending the full recovery of the economy,” it added.