IMF Praises Malaysia's Economic Resilience Amid Global Uncertainties

KUALA LUMPUR, 20 December 2025 – The International Monetary Fund (IMF) has commended Malaysia for demonstrating notable economic resilience despite global trade tensions and policy uncertainty, following its 2026 Article IV Consultation.

Led by Masahiro Nozaki, the IMF team noted Malaysia’s healthy 4.6% growth in 2025, driven by robust domestic consumption, investment, employment gains, and the global tech upcycle. Sound policies and the October 2025 Malaysia-US trade deal contributed significantly.

Economic Resilience

Growth is projected to moderate to 4.3% in 2026 due to higher US tariffs, with downside risks from protectionism, financial volatility, and AI shocks. Upside potential lies in tourism, trade negotiations, and reforms.

The IMF praised fiscal consolidation under the 2023 Fiscal Responsibility Act, targeting deficits of 3.5% GDP in 2026 and 3.0% by 2028. Inflation remains low at 1.4% in 2025, monetary policy appropriate, and financial risks contained. Structural reforms, including labour market enhancements and Asean integration, are urged for inclusive growth.

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