Malaysia On Track For 5.3 Pct GDP Growth In 1Q Despite Global Headwinds - Economist

By Nur Athirah Mohd Shaharuddin

KUALA LUMPUR, April 23 (Bernama) -- Malaysia’s gross domestic product (GDP) is on track to achieve 5.3 per cent growth in the first quarter of 2026 (1Q 2026), mainly driven by broad-based expansion across several sub-sectors, including manufacturing, services and construction, an economist said.

International Islamic University Malaysia associate professor of economics Dr Muhammad Irwan Ariffin said the estimation is achievable despite ongoing geopolitical headwinds, especially given the developments in West Asia right now.

Despite that, the growth rate showed a slight decline from the previous quarter in 2025, with the 4Q 2025 recording 6.3 per cent, he said.

“But I think, rather than looking at this as a sign of weakening of our fundamentals, the 5.3 per cent (rate) should be regarded more like stabilisation or normalisation after such extraordinary achievement due to the post-COVID-19 recovery last quarter.

“So now, we are more towards normalising. We are enjoying basically the real fundamentals of our economic growth,” he said during The Nation programme titled “Holding Ground: Malaysia’s Growth Story” produced by Bernama TV today.

Muhammad Irwan said Malaysia’s ability to sustain growth amid ongoing tensions in West Asia and broader global uncertainties reflects improved economic resilience compared to previous external shock cycles.

He said the country has built stronger buffers and cushions to absorb external shocks, reducing the risk that such disruptions will significantly impact overall economic performance.

“In the past, Malaysia’s economic growth was mainly driven by certain sectors targeted by government policies, and this basically made that one sector-driven economic growth more susceptible to external shocks.

“Now that we have learned our lessons from all the previous external cycles, we decided to actually spread and make sure that we diversify the base of our economic growth so that we do not simply depend on one sector, but we actually spread it out to different sectors,” he said.

He said that while some sub-sectors of the economy operate in a more isolated manner with limited spillover effects, others demonstrate stronger linkages that generate broader multiplier effects across the supply chain.

Citing tourism as an example, Muhammad Irwan said the sector requires multiple inputs and contributions across various industries, rather than relying on a single type of labour or skill, and it also creates a strong spillover effect that impacts multiple regions and different layers of society.

-- BERNAMA