Malaysia’s nominal GDP for 2023 amounts to RM1.8 trillion
Published on: Thursday, July 25, 2024
By: Bernama
In the manufacturing sector, the compensation of employees registered a 3.3% growth, driven by moderation in the electrical, electronic and optical products sectors. (Bernama pic)
PETALING JAYA: The statistics department reported Malaysia’s 2023 nominal gross domestic product (GDP) amounted to RM1.8 trillion.
Growth moderated to 1.6% from the double-digit 15.9% in 2022.
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In a statement, Chief Statistician Uzir Mahidin said despite the moderated performance, the economy remained resilient, particularly through private final consumption expenditure, which increased by 6.7%.
The growth was propelled by ongoing enhancement in employment and wage through the implementation of a new minimum wage of RM1,500 starting May 2023, he said at the release of the statistics for Malaysia’s GDP Income Approach for 2023.
He said the income statistics from economic production include three key components, namely compensation of employees (CE), gross operating surplus (GOS), and taxes less subsidies on production and imports (net taxes).
Given the improvements in the labour market, Uzir said CE recorded a steady growth of 4.2% while GOS declined by 1.8%. Meanwhile, the performance of the income distribution showed a shift towards a better share of CE at 33.1% compared to 32.3% in 2022.
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“Nevertheless, GOS still contributed substantially to the GDP at 64.8%, although 2.3% lower than the previous year.
The remaining component was net taxes, which accounted for 2.1%, he said.
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Looking at detailed sectoral performance, he said the increase in the CE component, encompassing the remuneration received by employees for their labour, was driven by the services, manufacturing and construction sectors.
“CE in the services sector grew 4.3%, supported by growth in all sub-sectors, particularly wholesale and retail trade, food and beverages and accommodation.
As for the manufacturing sector, CE registered a 3.3% growth, led by the moderation in electrical, electronic and optical products, he said.
Uzir said the decline in GOS was primarily influenced by the sharp downturn in the mining and quarrying (-12.1%), agriculture (-13.2%), and manufacturing (-5.6%) sectors.
“The fall of commodity prices in 2023 has lowered profitability across these sectors, leading to a marked decrease in overall GOS.
Nevertheless, the contraction was partially alleviated by the growth in the services and construction sectors at 5.3% and 1.3%, respectively, he said.
Net taxes, a component that represents the source of income for the government, showed a remarkable growth of 242% or RM37.7 billion in 2023, attributed to the higher taxation revenue compared to a decrease in subsidies.
In the context of international comparison, Uzir said the composition of CE in Southeast Asia was notably lower, accounting for less than 40% of GDP while GOS made up a larger share.
“Meanwhile, as opposed to advanced economies such as the US, Germany and Canada, CE constituted a greater share than GOS at 53.1%, 52.4%, and 51.1%, respectively.
Net taxes formed a smaller share of GDP in the selected countries, with Malaysia recording the lowest contribution of 2.1%, reflecting the differences of fiscal policies among countries, he said.
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