Budget 2027: RM83 Bln Development Expenditure Boosts Growth, Infrastructure
KUALA LUMPUR, Oct 16 (Bernama) -- Malaysia’s RM83 billion development expenditure allocation under Budget 2027 offers an opportunity to strengthen the country’s economic foundations, expand business opportunities and support sustainable growth, according to Malaysian Rating Corporation Bhd (MARC).
Group chief executive officer Arshad Mohamed Ismail said the focus should therefore not only be on the size of the allocation, but also on the quality and effectiveness of spending and its ability to generate longer-term economic returns.
“Continued investment can help strengthen Malaysia’s productive capacity, while also creating opportunities for greater private sector participation,” he said in a statement.
Arshad added that the budget reflects the government’s sustained commitment to supporting economic growth backed by sustained development expenditure, providing a foundation for strengthening Malaysia’s economic resilience and long-term growth potential.
Meanwhile, Public Investment Bank Bhd (PIVB) said the government’s proposed RM83 billion development expenditure allocation for 2027 was marginally higher than the RM81 billion allocated in the current year, representing a 2.5 per cent year-on-year increase.
Including the separately listed RM25 billion from government-linked investment companies, RM11 billion in public-private investments, and RM14.2 billion from federal statutory bodies and government-owned companies, the broader public investment totalled RM133.2 billion, a slight 1 per cent increase from RM131.8 billion in the previous year.
“This is in line with the government’s MADANI commitment to good governance and a gradual reduction in the fiscal deficit,” it said, adding that the 5th MADANI Budget continues to prioritise projects of public interest and infrastructure that support households, workers and businesses, in line with state development priorities.
“We believe that the transport subsector will remain a significant catalyst, as many high-multiplier projects, such as road maintenance and upgrades, rail investment, bus infrastructure, airport-access works and the Johor Bahru e-ART system fall within this category,” it said.
The investment bank said that water infrastructure is another significant catalyst under Budget 2027.
It stated that notable initiatives include RM2.5 billion to reduce national water losses, including replacing 1,900 kilometres of critical ageing pipes.
“The budget also names the Machang Water Treatment Plant, the proposed Lebir Dam and water-supply works in Kelantan,” it said.
PIVB added that a planned Sovereign AI Cloud was also mentioned, intended to keep Malaysian data and the country’s strategic information under Malaysian control, the research house added.
-- BERNAMA