AmWatch - Economic Update : GNI per capita rises to USD10,060 in 2013, 15 May 2014

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Economic Update : GNI per capita rises to USD10,060 in 2013

Malaysia’s GNI per capita rose to USD10,060 last year, the government said in its 2013 Economic Transformation Program annual report released on Monday. That compares with the previously reported GNI per capita of USD9,970 in 2012 and the target of USD15,000 by 2020.

GNI per capita has climbed steadily from USD7,059 in 2009, representing a growth of 42.5% between 2009 and 2013. The government made great efforts in moving towards a revenue structure that benefits a high-income economy. Since 2010, government revenue has risen by 38.1% to RM220.4bil. Meanwhile, private investments grew by 15.3% to RM161.1bil between 2010 and 2013.

In tandem with increasing government’s revenue stream, fiscal shortfall has been gradually reduced from 6.6% of GDP in 2009 to 4.0% in 2013. Key aspects of lowering fiscal deficit include the government’s prudence in expenditure, an efficient tax collection and a broader tax base.

The government has also implemented a phased rationalisation of subsidies to ensure a more targeted approach in providing financial assistance to low income earners. All in all, ETP recorded cumulative investments of RM219.3bil, projected GNI of RM143.5bil, and created 437,816 new jobs since its launch in 2010.

Key economic indicators continue to suggest an expansion of private investment on the back of positive fundamentals domestically. We expect GDP growth to be driven in part by the ongoing ETP initiatives coupled with the relatively healthy external demand which will be supportive of strong net trades in 2014. That aside, we believe that economic challenges could potentially arise from domestic fiscal consolidation efforts which may derail sentiments and growth prospects ahead.

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