Strong 5.2% growth in 2025 provides cushion against global uncertainties, says Finance Minister II Amir Hamzah, as Malaysia monitors Middle East tensions
KUALA LUMPUR: Malaysia’s robust 5.2% economic growth in 2025 is expected to cushion the country against global uncertainties and bolster its performance in the first quarter of 2026. Finance Minister II Datuk Seri Amir Hamzah Azizan stated that the implications of the Middle East conflict carry global consequences, as energy prices influence inflation and borrowing costs.
“However, for Malaysia, the government is managing the situation and monitoring developments in the Middle East very closely,” he told reporters after attending the 2nd ASEAN Banking and Finance Summit. He noted that Malaysia’s position as a net oil exporter places the country in a reasonable position despite oil prices surging.
Global oil prices have risen significantly with Brent crude now trading at US$115.40 per barrel. Amir Hamzah highlighted that domestic demand remains resilient and investment is surging, driven by multi-year infrastructure projects.
The country’s fiscal deficit is narrowing towards the three per cent target under the Fiscal Responsibility Act, while the ringgit has strengthened. On the RON95 petrol price, Amir Hamzah said the government would try to maintain the subsidised price at RM1.99 per litre for the next two months.
“This is because we have the capacity to do that. However, for the open market, the current (global) price will reflect the price being transmitted through,” he said. He added that it is too early to determine if a higher subsidy bill would be offset by increased petroleum revenue.
He assured that oil supply in the country remains stable and there will be no supply disruptions. Earlier in his keynote speech, Amir Hamzah said the escalating geopolitical conflict has evolved from a contained crisis into a regional conflict with global consequences.
He said retaliatory strikes across the Gulf signal growing instability, with immediate implications for the financial sector and the broader global economy. “Energy prices feed directly into inflation, borrowing costs and the credit risk calculations that banks make every day,” he said.
Amir Hamzah added that geopolitical instability could also reshape the investment appetite of multinational corporations that countries such as Malaysia are seeking to attract. “When energy routes are threatened and trade corridors become contested, every economy in ASEAN feels the impact,” he said.
