Top rating agencies give thumbs up on M’sian economy

07 May 2019 / 12:19 H.

PETALING JAYA: Top international rating agencies are confident that the country will achieve its fiscal targets for this year, according to the Finance Ministry.

Finance Minister Lim Guan Eng had recently engaged with Standard & Poor’s Financial Services LLC (S&P), Moody’s Investors Service (Moody’s) and Fitch Ratings Inc. (Fitch) — the top three rating agencies — on Malaysia’s current economic and financial developments.

The ministry added that agencies have also expressed satisfaction with the country’s performance on the economic front this year.

“They were convinced that Malaysia will achieve our fiscal targets, particularly the 3.4% fiscal deficit to GDP ratio this year. They were also comfortable with Malaysia’s economic performance to date,” it said in a statement today.

According to the ministry, the meeting took place at the International Monetary Fund (IMF) and World Bank Group (WBG) Spring Meetings (IMF-WBG Meetings) held from April 11 to 13 in Washington DC.

Lim, who had led a Malaysian delegation there, was also invited to deliver a keynote address at a WBG event on digital economy where he shared the country’s views on the topic, including on the embracing of 5G to launch Malaysia into a high-income status nation.

“Lim also outlined the risks of digital disruption causing loss of jobs in traditional sectors, where many of these jobs will not be replaced by new jobs.

“He stated that Malaysia does not accept creative destruction, and there is a need to create new jobs through income incentives or supplements to replace jobs necessarily lost through digital disruption,” it said.

The ministry said Lim, who represented the 11-member Southeast Asia Voting Group (SEAVG) during the IMF-WBG Meetings, had also emphasised the importance of the WBG to not just uplift the living standards of poor countries but also the need to set up a model of how middle income countries could avoid slipping back into low-income status.

“This (model) is also so that these countries can escape the middle-income trap to be a high-income economy like Singapore, South Korea or Chile,” the statement added.

SEAVG comprises Malaysia, Brunei Darussalam, Fiji, Indonesia, Laos, Myanmar, Nepal, Singapore, Thailand, Tonga and Vietnam.

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