A measured push to balance growth and fiscal discipline amid global uncertainty
SUMMARY
- The government unveiled a record RM419.2b Federal Budget for 2026, comprising RM338.2b for Operating Expenditure (OE) and RM81.0b for Development Expenditure (DE). This modest increase reflects a careful balance between fiscal discipline and growth priorities, focussing on tackling economic challenges, social support, and productivity. The government aims for targeted, outcome-driven initiatives to uplift livelihoods and build a more competitive, equitable economy.
- The Ministry of Finance (MoF) projects GDP growth of 4.0%–4.5% in 2026, broadly in line with house forecast of 4.2%, betting on tourism, technology, and infrastructure upgrades to counter global headwinds. The government fuels domestic demand with raising incomes, targeted subsidies, and bold investments in semiconductors and renewable energy
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