Malaysia’s GDP grew by 7% in 4Q22, 8.7% in 2022


MALAYSIA’S economy grew by 7.0% year-on-year (YoY) in the fourth quarter of 2022 (4Q22), bringing 2022 full-year GDP growth to 8.7%.

The gross domestic product (GDP) notched for 2022 was the highest since 2000, according to data from Bank Negara Malaysia (BNM) and the Department of Statistics.

At 7.0%, the growth was still above the long-term average of 5.1%, with the private sector activity remaining the key driver of growth, supported by private consumption and investment.

“Private sector activity remained the key driver of growth, supported by private consumption and investment,” BNM governor Tan Sri Nor Shamsiah said at Bank Negara Malaysia’s (BNM) 4Q22 Economic Performance media briefing in Kuala Lumpur today.

She said the continued growth in private consumption was mainly driven by improving labour market conditions. Meanwhile, overall export growth moderated in line with the weaker external demand.  

“This was partly offset by the resilient performance in exports of electrical and electronic (E&E) products and higher tourism activities. The services and manufacturing sectors continued to drive growth,” she said.

For 2023, BNM said the Malaysian economy is expected to expand at a more moderate pace amid a challenging external environment.

“Domestic demand will continue to drive growth, supported by the continued recovery in the labour market and the realisation of multi-year investment projects. The services and manufacturing sectors will also continue to support growth,” according to its statement.

Nor Shamsiah said on a quarter-on-quarter (QoQ) seasonally-adjusted basis, the economy registered a decline of 2.6% compared to an increase of 1.9% in 3Q22.  

She noted that headline inflation moderated to 3.9% during the fourth quarter against 4.5% in 3Q22, mainly due to the lapse in the base effect on electricity inflation, a key contributor to the higher inflation in 3Q21.

“The moderating trend in key global commodity prices partly led to lower inflation in some consumer price index (CPI) items, including fuel.  

“Inflation for some key staple food items, such as fresh meat and eggs, also moderated during the quarter.  

“However, the downward impact of these factors was partly offset by higher core inflation,” she said.

For 2022 as a whole, Nor Shamsiah said the headline inflation increased to 3.3% from 2.5% in 2021, while core inflation averaged higher at 3.0% against 0.7% in 2021.  

She also highlighted that core inflation increased to 4.2% against 3.7% in 3Q22, driven by the continued strength in demand amid a still-elevated cost environment.