Budget 2023 supportive of Malaysia's economic growth - KRI

BUDGET 2023, through the adoption of a holistic and sustainable approach, is well-positioned to achieve the goals of strengthening the economy and enhancing the well-being of all Malaysians.

The measures announced in the Budget are timely and bold given the challenges faced by the nation, such as the continuation of global economic uncertainty, as well as geopolitical conflicts and supply chain disruptions leading to inflation.

In the context of the Shared Prosperity Vision 2030, the Budget measures aimed at supporting the creation of job opportunities, strengthening social protection and guaranteeing food security are timely.

The enhancement in cash assistance and subsidies in Budget 2023 should contribute to the reduction of the rakyat’s financial burden, particularly the vulnerable and low-income groups.

Expanding the coverage of PERKESO and EPF to include self-employed workers and homemakers will go a long way in protecting the target groups against risks emanating from economic shocks. The reduction in income tax rates should increase the disposable income of the middle-income group currently facing financial challenges due to the rising cost of living.

Incentives for the aerospace, pharmaceutical, medical devices, automotive, and petrochemicals industries as well as the allocation for research and development demonstrates the Government’s determination to create new job opportunities for Keluarga Malaysia.

Given the significant contribution of micro, small and medium enterprises (MSMEs) to economic growth and job opportunities, the emphasis of the Budget 2023 on this sector is timely.

The reduction in tax rates for businesses, as well as initiatives under Semarak Niaga with an allocation of RM45 billion through micro credit facilities and soft loans, financing guarantees, and the provision of one-off grants will ensure MSMEs remain resilient and competitive.

In addition, the allocation of RM10 billion from BNM for automation and digitalisation should enhance their contribution to the economy.

The issue of climate change has a direct impact on the lives of local residents as well as the sustainability of the country’s food security.

The Budget’s focus on climate change through the significant allocation for the Flood Mitigation Plan (RTB) is noteworthy given that natural disasters are occurring more frequently and intensely. The country’s food security will continue to be strengthened through investments by GLC/GLICs as well as subsidies and incentives to farmers and fishermen.

Budget 2023 is an important step towards ensuring that Malaysia continues on the development trajectory, anchored on the well-being of all Malaysians.

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Media Release from Tan Sri Nor Mohamed Yakcop, Chairman of Khazanah Research Institute (KRI)