KUALA LUMPUR, Nov 28: Malaysia’s economy grew 6.7 per cent in the third quarter helped by strong private consumption and investment, putting it on track for a 2007 target of 6 per cent, the central bank said on Wednesday.
The robust quarterly growth, which came in above expectations, was also credited to healthy manufacturing and construction.
Bank Negara governor Zeti Akhtar Aziz told reporters the central bank had “a high degree of confidence we will achieve 6 per cent growth for this year” due to the recent strength of domestic demand and investment.
The economy grew by 5.7 per cent in the second quarter and Zeti said that its momentum was expected to be sustained in the near term.
But there were medium-term risks, she said, including the prospect of a US economic slowdown.
“We will not be immune to the US economic cycle, there is not yet any clarity to the extent of the slowdown, whether it will be a pronounced slowdown or whether it will slide into a recession, that is still not clear,” she said.
However, Zeti said that strong domestic demand in Asian countries meant regional markets would not face the full brunt of any downturn in the US economy.
“Now the domestic demand has become more significant in our economy ... and so we expect a partial de-coupling to take place,” she said.
The central bank said the services sector grew by 10.5 per cent in the three months to September, helped by a boom in the tourism industry.
Malaysia has launched a campaign to attract 20.1 million tourists this year, up from 17.5 million visitors in 2006.
The construction sector expanded by 4.7 per cent in the third quarter due to the implementation of major infrastructure projects under a national development plan, the bank said.—AFP
