BATU KAWAN (Aug 8): Malaysia’s economy is on the right track for a recovery in 2021, said Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz.

Judging by the recent pickup in economic performance, the minister said he is optimistic that the country’s economy would rebound next year.

"Of course, the World Bank and the International Monetary Fund’s (IMF) forecasts for Malaysia’s gross domestic product (GDP) in 2021 are both very strong, between 6% and 8%, but this is subject to how we Malaysia and the world address the Covid-19 health crisis.

"We are watching this closely, but I’m very optimistic after seeing the facts and figures presented before us, especially for June and July," he told reporters after a visit to Vitrox Technologies Sdn Bhd in Batu Kawan here today.

He said the unemployment rate’s 0.4 percentage point (ppt) decline to 4.9% in June, from a record high of 5.3% in May, bodes well for the country’s economy.

By comparison, in June, the unemployment rate rose in the Philippines (17.7%), India (11%), the US (11.1%) and China (5.7%).

"Most European countries also recorded a double-digit unemployment rate, but for us, it is still under control," he said.

Commenting on the upcoming announcement by Bank Negara Malaysia (BNM) on the country’s second quarter of 2020 (2Q20) GDP results next Friday, Tengku Zafrul said he expects the figure to be affected by the implementation of the movement control order (MCO).

"Having said that, we are not alone as the Covid-19 is a global pandemic; more than 150 countries in the world will face an economic contraction in 2020," he said.

As for 3Q20, Tengku Zafrul said the results will depend on how the country handles the pandemic.

"If we can sustain the growth, 3Q20 should be better than 2Q20, though 4Q20 will also depend on how the global economy has improved because, as you know, we are a very open economy and we are very much part of the global supply chain," he added.

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