Kuala Lumpur: Malaysia has adequate buffers to weather volatility, including capital outflows, triggered by global interest rate hikes, said International Centre for Education for Islamic Finance (INCEIF) University Professor of Practice Tan Sri Abdul Wahid Omar. Abdul Wahid, who is also a former Bursa Malaysia chairman, noted that the country has sufficient international reserves to cover a good number of months of retained imports and short-term debt obligations.

According to BERNAMA News Agency, Abdul Wahid emphasized the importance of both foreign and domestic investments, stating that Malaysia’s international investments provide the flexibility needed to meet economic challenges. He expressed these views during the Islamic Finance Future Leaders Bootcamp 2025. Abdul Wahid also pointed out the cyclical nature of equity market movements, noting recent fluctuations with a positive inflow in May and outflows in June. He stressed that focusing on economic fundamentals will eventually attract capital back to Malaysia.

Commenting on Malaysia’s economic prospects, Abdul Wahid highlighted the country’s move away from commodity dependence, which has strengthened its economic fundamentals, allowing it to better absorb external shocks. He noted that the services and manufacturing sectors currently drive the economy, a diversified structure developed over years. The commitment to managing government funds and reducing the fiscal deficit further enhances economic resilience.

Abdul Wahid mentioned that Malaysia’s economy grew by 5.1 per cent last year. Despite current external pressures, he projected a growth rate between 4.0 to 5.0 per cent for 2025. He remarked that a 4.0 per cent growth remains credible given the global challenges today, underscoring the robustness of Malaysia’s economic framework.