Malaysia Is About to Toss Out a Big Summer of Money Before the Election
On Friday, 7 October, Malaysia will unveil its next budget—one that’s a shade more generous than usual. The move? A bid to warm up voters just before authorities possibly call an early general election, all while inflation’s wallowing and global recession whispers seem to loom large.
Why Now?
Even though the official election window opens in September 2023, some factions in the ruling coalition are waving a flag for an earlier vote. Picture this: monsoon‑swept regions hit with floods at the end of the year—yet the big political deal is still on the table. Whatever the timeline, the Oct. 7 budget will be the final financial doc before the next ballot, so the stakes are rolling high.
Cash, Cash, and More Cash
Economists predict a skinny roster of generous cash handouts and goodies. Think of it as the government’s “feel‑good” package:
- Expanded Social Support: More cash transfers, wider eligibility, deeper benefits.
- No Big New Taxes: Despite the temptation for extra revenue, the new budget is likely to keep the taxes on the back burner.
- Bundle of “Goodies”: The aim is clear—every possible welfare cookie gets baked into this budget.
- Fiscal Reality Check: Diluted spread of cash because the treasury is dealing with the “bubble” of high subsidies.
“There’s a real sense that the government will leave no stone unturned,” says analyst Alexander Chia from RHB Bank, “because it’s the last hurrah before the 15th General Election.” He adds, however, that fiscal headroom is tight, so any new handouts will have to use the wiggle room wisely.
Subsidies on a Wild Ride
Last year, Malaysia roared with a record RM80 billion (~S$24 billion) in subsidies. That number is expected to climb in 2024 as global price spikes bite. The big government sponsor, Petronas, is doubling its dividend—piling up another 50 billion ringgit to his pocket to help juggle the rising cost of living.
Beyond the Numbers
The economy is healing beautifully from the shockwave of the COVID‑19 pandemic. In the second quarter, gross domestic product grew at its fastest half‑year pace in a full year. But the government warns that 2023’s growth might sit a bit lower than this year’s high.
In short, Malaysia’s next budget is set to be a generous feast—to keep voters smiling, to cushion businesses from pandemic aftermath, and to balance the high-stakes art of political strategy during a period of rising debt, inflation, and an uncertain global economic outlook.
