Japan rating agency upgrades Malaysia to A+

JAPAN Credit Rating Agency Ltd (JCR) has upgraded Malaysia to A+, reflecting the nation’s rich oil and gas resources, robust export-oriented manufacturing base and sound financial sector.

In a statement today, it said Malaysia’s foreign currency long-term issuer rating was moved up one notch to A+ from A, with a stable outlook. The local currency’s long-term issuer rating was bumped up from A+ to AA, again with a stable outlook.

The agency said that Malaysia’s economy has recovered since the first quarter of 2022 above the pre-pandemic level as the Covid-19 pandemic has subsided.

“The country’s industrial base is being strengthened and upgraded amid a significant increase of foreign direct investment in recent years,” it said in a statement.

JCR said it expected a strong economic growth of around 5% to continue for the time being.

“While strengthening the revenue base has been an issue, the fiscal base is improving as the government is keen to implement necessary measures such as continuous enforcement and auditing in collecting taxes and other revenue. The government debt-to-GDP ratio is manageable in mid-60%, although it has increased due to increased spending on an anti-pandemic economic package, it is still at a manageable level.

“The country continues to have a current account surplus and its resilience to external shocks is increasingly backed by its ample foreign currency reserves. Based on the above, JCR has upgraded the ratings by one notch with a Stable outlook,” it said. — TMR / pic TMR FILE