Malaysia’s economy posts robust growth despite global headwinds - Vietnam+ (VietnamPlus)

MALAYSIA, 28 JULY 2026 —

Preliminary estimates showed the Malaysian economy expanded by 5.8% in the second quarter of 2026, lifting growth for the first six months of the year to 5.6%, up from 4.5% in the same period of 2025. Kuala Lumpur (VNA) – Malaysia’s economy maintained strong momentum in the first half of 2026 despite persistent challenges from geopolitical uncertainty, trade pressures, volatile energy prices and disruptions to global supply chains.

The performance exceeded market expectations and was above the 4.7% full-year growth forecast for Malaysia in the International Monetary Fund (IMF)'s World Economic Outlook released in July 2026. Inflation remained under control at 1.9% in June while labour market conditions stayed resilient. As of May, Malaysia’s labour force had risen to 17.34 million, with more than 16.82 million people employed. The labour force participation rate stood at 70.9% while unemployment remained low, at 3.0%.

Exports continued to be a key growth driver, with monthly exports reaching a record 184 billion MYR (46 billion USD) in May, supported by strong shipments of electrical and electronic products, semiconductors, automotive goods and rising demand for artificial intelligence (AI)-related products. Akmal said economic expansion in the second quarter was broad-based, led by mining (10.2%), manufacturing (7.5%), construction (6.6%) and services (5.4%).

However, agriculture contracted 3.7%, highlighting the need to prioritise food security, smallholder incomes and rural communities. The minister said the Malaysian Government will continue monitoring global economic risks, particularly developments in energy prices, financial markets, commodities, food supplies and electricity demand. Looking ahead, he said Malaysia’s long-term resilience will depend on reducing structural vulnerabilities while strengthening capabilities in food security, energy, exports, logistics and technology.

For the second half of 2026, the Ministry of Economy will focus on implementing the 13th Malaysia Plan (2026–2030), with the goal of translating economic gains into tangible benefits for households, workers and businesses. Its four priorities are accelerating implementation, ensuring benefits reach targeted groups across society, measuring progress through improvements in income, productivity, skills, employment and quality of life, and strengthening policy interventions when targets are not met.

Akmal stressed that Malaysia must turn budget allocations into measurable outcomes and convert investment commitments into quality jobs, stronger domestic supply chains and greater technology transfer. He added that effective public policy should be guided by clear objectives, tangible results and strong accountability./.

Speaking at the launch of the initiative on June 24, Malaysian Transport Minister Anthony Loke Siew Fook said the Civil Aviation Authority of Malaysia (CAAM) has been tasked with developing a regulatory framework to support the safe integration and expansion of low-altitude aviation services. The US has set a 10% tariff on Malaysian goods under the Section 301 measure related to forced labour. The rate is unchanged from the previous temporary tariff.

Malaysian Prime Minister Anwar Ibrahim said July 24 that his Government will continue talks with the US over the new tariff linked to forced labour concerns if current negotiations fail to produce a satisfactory outcome. Conservation experts emphasise that protecting the Giant Ibis is of paramount importance and urge the public to prevent illegal land clearing, end wildlife trafficking and poisoning, and decline the consumption or keeping of wild animals.

The Peace Village Project is part of the Cambodia-RoK Strategic Partnership. In its second phase, the project is being implemented in 30 villages across three northwestern provinces that were heavily affected by war and landmines, with the aim of transforming them into areas of peace, sustainable development and shared prosperity.

The SMEs Competitiveness Index fell to 45.1 points in the second quarter, down 0.8 points from the previous quarter and remaining below the 50-point threshold that signals a contraction in business conditions. Cambodian Prime Minister Hun Manet called for stronger digital education through improved digital infrastructure at schools, expanded online learning resources, greater use of technology in teaching, and better digital platforms to prepare students for the future labour market.

Addressing a meeting with 150 researchers from the National Research and Innovation Agency (BRIN) on August 6, Indonesian President Prabowo Subianto affirmed that mastery of science and technology is essential for accelerating national development and enhancing Indonesia's global competitiveness. Data centres have accelerated in growth throughout Southeast Asia. Much of the region’s recent data centre growth has shifted towards Malaysia; Thailand, Indonesia and Vietnam are also building capacity.

More than 107,000 hectares of land burned in Indonesia between January and June this year, more than double the area destroyed in forest fires in 2023, according to the country's Ministry of Forestry. Cambodian Deputy Prime Minister Sun Chanthol urged the private sector to work closely with the government in preparing for the next phase of industrial development by moving upstream into higher value‑added manufacturing and strengthening supply chain capabilities.

For KL20 2026, four new priority areas have been added, aligning with Malaysia's 13th Malaysia Plan (2026–2030), which seeks to increase economic complexity, strengthen high-value industries and expand domestic production of value-added goods and services.

Speaking at the signing ceremony, Thai Minister of Natural Resources and Environment Suchart Chomklin described the TOR signing as an important milestone in bilateral environmental cooperation, saying it would enhance water resource management, protect ecosystems and improve life quality for those living in border areas.

The two sides agreed to strengthen cooperation in smart agriculture through the application of automation, the Internet of Things (IoT), advanced technologies and innovation, while promoting the use of modern agricultural machinery and expanding workforce training.

At the Thailand-Myanmar Business Forum in Bangkok, attended by Thai Prime Minister Anutin Charnvirakul, President Min Aung Hlaing and more than 700 representatives from government agencies, businesses and the business communities of both countries, the two leaders outlined orientations for boosting economic cooperation and expanding bilateral ties. Philippine authorities said four… (AI-assisted rewrite, based on the original source)

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