Malaysia’s record 2025 budget to boost economy, welfare, as Anwar leverages political stability
The budget aims to grow Malaysia’s appeal as a destination for hi-tech investments while also uplifting the country’s most vulnerable groups
Malaysia’s newly released 2025 budget, the largest in its history, seeks to cut subsidies, narrow the fiscal deficit and bolster the economy’s competitiveness while addressing demands for higher wages and improved social welfare.
Prime Minister Anwar Ibrahim on Friday presented the 421 billion ringgit (US$98 billion) budget plan for 2025, saying it aimed to grow the country’s appeal as a preferred destination for hi-tech investments while also uplifting the country’s most vulnerable groups.
The government expects to bring its total subsidy bill down by 14.4 per cent to 52.6 billion ringgit in 2025 in the first full year of revised electricity and diesel prices, after subsidies for the two items were slashed earlier this year.
This includes the introduction of targeted subsidies for RON95 petrol by mid-2025 to exclude an estimated 15 per cent of total users who are either rich or non-Malaysians, saving an estimated 8 billion ringgit.
“The savings will be used for the well-being of the masses,” Anwar said in his budget speech, adding that the government would maintain 12 billion ringgit in petrol subsidies.
Malaysia’s fiscal deficit is expected to narrow to 3.8 per cent of gross domestic product in 2025, down from 4.3 per cent forecast for this year. Its total debt stood at more than 1.2 billion ringgit or 63.1 per cent of GDP as of June this year.
