Malaysia’s Najib unveils expansionary budget as polls loom

KUALA LUMPUR (Reuters) – Malaysian Prime Minister Najib Razak announced an expansionary budget targeted at his vote bank on Friday, as he looks to shore up support ahead of a tough election that must be called by next year.

“I stand here today… to bring happy news that will put a smile on everyone’s faces,” Najib said as he delivered his budget speech in the parliament.

Najib said Malaysia plans to spend 280.25 billion ringgit ($66.1 billion) in 2018, up 7.5 percent from this year’s allocated budget of 260.8 billion ringgit.

Before the speech, Najib said the budget would be “mildly expansionary”. Analysts had predicted increased spending on handouts and infrastructure projects.

Malaysia’s improved economic performance and revenue collection this year, aided by higher oil prices, facilitates Najib hiking spending ahead of elections.

Despite increased spending next year, the fiscal deficit is seen narrowing to 2.8 percent of gross domestic product in 2018 from the projected level of 3.0 percent this year.

Growth is expected to come in at 5.2 to 5.7 percent this year, on robust exports and some recovery in global crude prices, the government’s annual economic report said. In 2016, the economy expanded 4.2 percent.

The economic report, released in conjunction with the budget speech, said growth next year is forecast to be 5.0-5.5 percent.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.