Malaysia’s growth forecast to ease to 4.2% to 5.2% in 2027
Private investment is projected to grow by 7.1%, with spending directed towards technology-intensive services and manufacturing.
Malaysia faces slower domestic demand and less rapid expansion across most sectors in 2027, when economic growth is forecast at 4.2% to 5.2%, according to the Ministry of Finance. The ministry’s Economic Outlook 2027 puts the 2026 growth estimate at 4.8% to 5.3%.
Services are projected to grow by 5.2% in 2027, below the 5.5% estimate for 2026. The sector represents more than half of Malaysia’s economic output. Manufacturing expansion is forecast at 4.1%, against 6.2% estimated for 2026, while construction growth is expected to ease to 5.7% from 6.4%.
The ministry forecasts a 4.8% increase in private consumption, compared with its 2026 estimate of 5.0%. Its projection for private investment growth is 7.1%, down from 7.8%. Spending on hyperscale data centres, infrastructure for artificial intelligence and advanced manufacturing facilities is expected to support investment.
Public investment is forecast to rise by 6.8%, supported by development expenditure and capital spending, versus an estimated 7.7% in 2026. Public consumption growth is projected at 3.2%, compared with 3.8%, with support from expenditure on civil servant salaries, supplies and services.
The trade forecast points to a 3.2% increase in 2027, bringing total trade to RM4.02 trillion from the 2026 estimate of RM3.90 trillion. The ministry expects the current account surplus to reach RM41.8 billion, compared with an estimated RM41.3 billion.
Trade flows, tourism and employment conditions are expected to underpin economic expansion. The ministry also identifies Visit Malaysia 2026-2027 and the 34th SEA Games as contributors to growth.
