Credit Suisse sees Malaysia’s GDP growth to outperform regional peers

KUALA LUMPUR (Feb 9): Credit Suisse Emerging Markets Economic Research expects Malaysia’s real GDP growth to
continue outperform the other small open economies in the region.
It said on Thursday, the growth would be underpinned by the strong domestic demand, high palm and crude oil prices, and
the fiscal boost from the government.
“Malaysia’s real GDP growth has outperformed industrial production growth since the global financial crisis, as the services
sector has been the main contributor to real GDP growth during this period. Our real GDP growth forecasts for 2011 and
2012 remain unchanged at 5% and 4.8%, respectively, above the consensus forecast of 3.8% for 2012,” it said.
Credit Suisse Research said Malaysia’s December industrial production expanded 3% on-year in December, stronger than
market expectations of 1.7% on-year. November’s figure was also revised up to 2.4% on-year from 1.8% on-year.
“On a seasonally-adjusted basis, we estimate that IP rose 1.2% on-month in December. Malaysia’s sequential industrial
production performance was stronger than that of its regional peers in 4Q, expanding by 2.5% on-quarter in 4Q, while most
of the other export-oriented economies in the region registered a contraction in sequential industrial production in 4Q,” it said.
On the trade data, it said external trade remained strong with exports rising 6.1% on-year in December, while imports
rebounded 10.4% on-year.
“Import growth has outpaced export growth since the global financial crisis, suggesting that domestic demand remains the
main driver of GDP growth. Imports are now 7.6% higher than their pre-crisis peak, while exports are still 4.3% below their
pre-crisis peak,” it said.