The government will not hesitate to take tough, necessary and right decisions for achieving Malaysia's goal to remain a safer, more prosperous and equal society in 2016, said Datuk Seri Najib Tun Razak.

The Prime Minister said such decisions would be taken even they were not popular "in order to protect the people from the scourges of terrorism."

"To protect our precious unity that safeguards our unique diversity, and to protect that bright future that is the birthright of every Malaysia," he said in his New Year message today.

"I can assure you that the government will always strive with every sinew," he said.

Najib also reminded all Malaysians not to take security lightly and underestimate the clear and present dangers faced by the country internally and externally.

Malaysia faces multiple menaces that recognise no borders, from terrorism to foreign incursions into its sovereign territory, such as Lahad Datu in 2013, said Najib.

He added that 150 Malaysians had been arrested for terrorism-related activities since the formation of a so-called Islamic State and potential attacks in Kuala Lumpur, that had been foiled.

Thus, he said, this threat must be taken seriously, and this is why the government passed the Prevention of Terrorism Act (PoTA) at the beginning of the year and the National Security Bill earlier this month.

The Prime Minister said with the two laws, it would enable security forces to control and manage threat and react at an early stage, before a situation can escalate.

"We will not wait for terrorist outrage to take place before proactively putting in place all measures necessary to avert the possibility," he said.

Najib also stressed that the battle against radicalisation and those that blaspheme the name of Islam with their barbarities must also be fought in Malaysia, not just in the Middle East.

Describing 2015 as a year full of challenges for Malaysia and other countries, he said economically, Malaysia was not alone in being affected by the drop in oil prices.

"But as one of the few net-oil exporting countries in East Asia, it impacted our finances more than most," he said adding that the slowdown in China's economy has also affected the local economy.

He said despite challenging global economic headwinds, the World Bank has commended Malaysia for keeping its macroeconomic policies strong.

"In 2016, we expect our economy to expand between four to five per cent, driven by private investment and consumption," he said.

On another note, the Prime Minister stressed that the government has never looked for the easy and popular route in facing challenges as proved by the implementation of GST.

"A new tax is rarely welcomed. But amidst falling oil prices, if we had not had the revenue from GST, our fiscal deficit would rise from 3.1 percent to 4.8 percent for 2016," he said.

This, he said would cause in Malaysia's credit rating to be downgraded which would among others result in higher interest rate, decrease in investment and reduction in employment opportunities.

"The well being and advancement of our people is always in our minds when we set policy," he said.

He added strengthening the resilience of the economy, managing the impact of external vulnerabilities and safeguarding the interests of the people are the goverment's priorities for 2016.

Najib said the government would closely continue to review and monitor its policies and programmes to ensure they bring clear benefits to the people.

"I am determined that no Malaysian will be left behind as our country continues to grow. We have a plan, it is working and we are delivering," he said.

On 1Malaysia Development Berhad (1MDB) issue, Najib said the prejudgement of the issue, based on political smears, leaks and incomplete information have harmed Malaysia's economy and good name abroad.

However, he said the step taken by the company today which entered into agreement for the sale of 60 per cent equity in Bandar Malaysia to a joint local and international consortium, was the final step of its rasionalisation plans to be completed.

It is therefore clear that 1MDB's major challenges are now behind it, he said pointing that the agreement would see the company's debts reduced by approximately RM40.4 billion which represents the overwhelming majority of
1MDB's debt.

"Now it's time for us to await the outcomes of the inquiries into the company to take note of any lessons that need to be learned and to move on together in a constructive manner," he said.

The new year message also stressed on the importance of unity where the Prime Minister called for the rakyat to take care and be respectful to one another and not purposefully inflame tensions.

He also called on the rakyat to participate and support the setting up of Consultative Committee of Political Funding as a reform to strengten the integrity and transparency of political parties in the country.

On another note, Najib said 2015 has created another historic turning point for Malaysia as the chairman of ASEAN this year, with the establishment of the ASEAN Economic Community which marked the beginning of a new era for a combined population of 625 million people.

"We hosted world leaders in Kuala Lumpur as ASEAN and the United States announced a new strategic partnership while our ties with China have never been stronger," he said.

Najib said as a stable and tolerant country, Malaysia's leadership has been recognised as a responsible actor on the global stage and a key partner in the fight against extremism.