Malaysia’s economy is diversified, competitive and has a healthy banking sector, says a Senior Economist at ABN Amro Group Economics. Maritza Cazebas said these were positive points to soften the impact of a global economic slowdown.

She pointed that the Malaysian economy performed well during the first quarter of the year.

When asked whether Malaysia was an investor and business-friendly nation, she said: “Malaysia is making the right moves to sustain investment. It offers an investor friendly environment. This is reflected in the high rankings obtained in the Global Competitiveness (21/142) and Doing Business (18/183) indicators,”

On the Government Transformation Programme initiated by Prime Minister Datuk Seri Najib Tun Razak, the analyst said the programme to tackle corruption, improve education and upgrade rural infrastructure was a key commitment in improving the investment environment.

She said scope for discretionary fiscal support appeared limited.

Noting that Malaysia continued to subsidise electricity and fuel consumption and policies to lower these subsidies (long promised and repeatedly delayed) represented a wild card to the inflation pattern.

She said inflation had increased gradually since 2009, but remained subdued.

A major challenge, she said was to move further up the value chain and to prevent losing market share to other low-cost producing countries.