KUALA LUMPUR: In an effort to manage external shocks that may affect the well-being of the people and businesses, the government has set a medium-term priority of implementing structural reforms that will strengthen the country’s economic resilience.

       In its pre-Budget statement, the Finance Ministry said the reforms will be done by, among others, increasing productivity and sustaining innovation and promoting regional collaboration to ensure resilient infrastructure development and energy provision.

       It will also be done by enhancing the social protection system; strengthening human capital development; as well as enhancing transparency and accountability of public institutions.

       “These measures will further improve policy certainty and investors’ confidence, thus strengthening the country’s economic resilience for Malaysia to continue becoming an attractive investment destination,” it said.

       Given the significant contribution of the small and medium enterprises (SMEs) towards the economy, it said the government will more greatly emphasise the development of SMEs to be more competitive and resilience.

       On Malaysia’s economic performance for the year, it said the country started off strongly in 2022 with a gross domestic product (GDP) growth of 5% in the first quarter, Bernama reported.

       “The favourable performance was supported by both domestic and external demand, as well as a continued reduction in unemployment,” it added.

       The ministry said the pace of Malaysia’s economic recovery is expected to accelerate as the economy and international borders reopen; however, as a highly open economy, the pace of Malaysia’s economic recovery is dependent on global economic developments.

       “Geopolitical tensions, for example, have resulted in multiple economic pressures, most notably an increase in global inflation as commodity prices continue to rise.

       “Furthermore, the risk of tighter global financial conditions, labour shortages and rising living costs may complicate the country’s economic recovery efforts,” it cautioned.

       The ministry assured that the government will continue to monitor the various economic risks and effectively manage any external shocks that may affect the well-being of the people and businesses