KUALA LUMPUR, Nov 6 (Reuters) - Malaysia’s government announced an expansionary budget on Friday aimed at spurring domestic activity as the country grapples with the fallout of the COVID-19 pandemic, setting aside concerns of a growing fiscal deficit for the time being.
Here are some highlights from the planned budget, including data from the fiscal and economic outlook reports released by the government ahead of the budget speech:
* Expenditure to rise to 322.5 billion ringgit ($77.94 billion) in 2021 from 314.7 billion ringgit in 2020
* Revenue to total 236.9 billion ringgit vs 227.3 billion ringgit in 2020
* Operating expenditure seen at 236.5 billion ringgit
* Development expenditure seen at 69 billion ringgit
* COVID-19 fund allocation seen at 17 billion ringgit vs this year’s 38 billion ringgit
* Dividend from state oil firm Petronas at 18 billion ringgit, down from this year’s 34 billion ringgit
* Fiscal deficit to fall to 5.4% in 2021 from 6% in 2020 - the highest since 2009 global financial crisis
* Current account surplus seen falling to 20.3 billion in 2021 from this year’s 48.5 billion ringgit due to an expansion of domestic industrial and investment activities * Forecasts fiscal deficit to average 4.5% between 2021 and 2023, assuming the economy grows at a pace of 4.5%-5.5% over the period and crude oil prices trades at $45-$55 per barrel
* Economy seen growing 6.5%-7.5% in 2021, after shrinking 4.5% this year
* Gross exports to grow 2.7% after falling 5.2% in 2020
* Inflation expected to normalise at 2.5% in 2021
* Unemployment rate to drop to 3.5% in 2021 from 4.2% this year
* Domestic demand seen rebounding 6.9% in 2021, after an expected fall of 3% this year due to lower private and public sector spending ($1 = 4.1380 ringgit) (Reporting by Joseph Sipalan and A. Ananthalakshmi; Editing by Ana Nicolaci da Costa)
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