THE economy shrank 3.4% in the fourth quarter (Q4) of 2020 with the Covid-19 resurgence, bringing the full-year contraction to 5.6%.

Department of Statistics chief statistician Dr Mohd Uzir Mahidin said Malaysia’s last contraction was in 2009 at -1.5% and 2020’s contraction was the worst since the 7.4% decline in 1998.

“The slower growth in the quarter was driven mainly by tighter movement restrictions as well as commodity supplies disruption but offset by continued growth in external demand,” he said during the release of the Q4 gross domestic product (GDP) report, which was held virtually today. 

Meanwhile, the 2021 economic outlook will be unveiled during the next monetary policy cmmittee (MPC) meeting, scheduled on March 4, said Bank Negara Malaysia governor Nor Shamsiah Mohd Yunus.

Previously, the GDP is forecast to grow 6.5 to 7.5% this year.

She said near-term growth in 2021 is expected to be affected by the reintroduction of stricter containment measures but its impact would be less severe than that experienced in 2020.

Overall, the economy would recover in 2021 supported by improved global demand and normalisation in domestic economic activities, she said at the same briefing today. – Bernama, February 11, 2021.