Malaysia’s third quarter GDP to slow
(Bernama) – Malaysia’s gross domestic product (GDP) for the third quarter of 2012 will be lower due to the reduced trade figure recorded for that quarter, said Second Finance Minister Datuk Seri Husni Hanadzlah.
However, the country is on track to achieve the 4.5 per cent to five per cent targeted gross domestic product (GDP), for 2012.
“We believe that our third quarter is lower than the second. This is because of the global economic conditions. It has not improved and as a result, our trade has been affected,” he told reporters after the launch of the ninth Kuala Lumpur Islamic Finance Forum 2012 (KLIFF 2012) today.
Malaysia’s total trade in August fell to RM104.84 billion compared with RM106.17 billion in the same month last year.
Recently, the International Monetary Fund (IMF) said that Asia will continue to power the global economy, but warned there was an increasing risk that growth in the region, could drop to levels last seen during the global financial crisis.
The Fund foresees the Asian region economy expanding 5.9 per cent in 2013, 0.7 of a percentage point below the April estimate, it said in an update to its regional economic outlook.
The IMF added that a hard landing in China’s economy remained a low probability risk, but warned that such a scenario would have a significant impact on Asian economies, if it did occur.
Malaysia’s economy strengthened to 5.4 per cent in the second quarter 2012 against 4.9 per cent in the preceding quarter, led by continued expansion in the services and manufacturing sectors.
He pointed out that the GDP for the second quarter will be the highest recorded in 2012. He noted that the destabilisation effects of QE3 will not impact Malaysia’s economy.
Meanwhile in his speech earlier, Husni said there is a need to expand the Shariah framework to provide solutions to sophisticated high net worth individuals, balancing the tenets of Islam and the complexities and realities of current financial, legal and taxation requirements.
He said by expanding the range of value-add structures, products and services, the wealth management industry is in a position to play a key role in diversifying system-wide risks.
“At the same time it adds depth and breadth to the country’s domestic direct investment marketplace, secondary market liquidity and expansion of local talent pool and technical expertise.
“In the last 10 years, our domestic investment management industry has expanded rapidly. This development was supported by a prudently sequenced deregulation measures, especially in regards to the market』s access to products and services, as well as the opening up of distribution channels within the industry,” added Husni.
Global Islamic assets have grown at an average rate of 15 per cent to 20 per cent per annum for the last 10 years to reach US$1.3 trillion in 2011.
Husni said the government had also strengthened the standards for investor protection by enhancing disclosure and governance standards.
“As a result, our domestic Assets Under Management (AUM) grew at a compounded rate of 21 per cent per annum from RM55 billion in 2000 to RM377 billion in 2010,” he noted.
Malaysia’s AUM is estimated to grow to RM1.6 trillion in 2020.
The KLIFF 2012 is a two-day forum beginning today and organised by the Centre for Research and Training in collaboration with Hisham, Sobri and Kadir, the Association of Islamic Banking Institutions Malaysia and Amanie Advisor.
The forum has brought together scholars, practitioners, industry players and the public who have an interest in Islamic Banking and finance.
