Malaysia’s GDP surges 6.3%, highest in three years, as Anwar credits Madani reforms and fiscal discipline
PUTRAJAYA, Feb 14, 2026 – Malaysia recorded its strongest quarterly economic growth in three years as gross domestic product (GDP) expanded 6.3 per cent in the fourth quarter, surpassing earlier government projections.
Prime Minister Datuk Seri Anwar Ibrahim said the robust performance was underpinned by resilient domestic demand, stronger private investment and sustained recovery in the services and manufacturing sectors.
The fourth-quarter surge lifted full-year GDP growth to 5.2 per cent in 2025 compared with 5.1 per cent in 2024, exceeding the government’s forecast range of four to 4.8 per cent.
Anwar, who also serves as Finance Minister, attributed the outcome to disciplined fiscal management and consistent structural reforms implemented under the Ekonomi Madani framework.
“This growth did not happen by chance. It reflects responsible fiscal consolidation, targeted subsidy rationalisation and strengthened economic fundamentals,” he said.
For the second consecutive year, the government outperformed its fiscal deficit target, narrowing the deficit to 3.7 per cent in 2025 from 4.1 per cent in 2024, better than the initial projection of 3.8 per cent.
Macroeconomic stability strengthens
The economic expansion was accompanied by improved labour market conditions, with unemployment declining to 2.9 per cent — the lowest level in over a decade.
Inflation remained moderate at 1.4 per cent in 2025, down from 1.8 per cent in 2024, easing cost-of-living pressures.
Savings generated through fiscal reforms were redirected towards targeted assistance programmes such as Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA), while maintaining infrastructure development commitments.
Investor confidence also strengthened, reflected in the ringgit’s performance as one of Asia’s better-performing currencies and stronger foreign direct investment inflows.
The FTSE Bursa Malaysia KLCI reached a seven-year high, signalling improved market sentiment and renewed optimism over Malaysia’s economic trajectory.
Reform momentum must continue
Despite the encouraging indicators, Anwar cautioned against complacency, citing global trade tensions and geopolitical uncertainties that continue to pose external risks.
He emphasised that 2026 must focus on deepening structural reforms, enhancing value-added economic activities and strengthening governance standards.
Key priorities include anti-corruption measures, improving ease of doing business and ensuring inclusive economic gains for the broader population.
With macroeconomic fundamentals improving and fiscal discipline reinforced, Malaysia appears increasingly well-positioned to sustain growth amid global volatility.
-wilayah.com.my
