Chapter 2: Policy and Outlook in 2025

Continued growth in exports and imports in 2025

Malaysia’s gross exports are expected to grow by 5.2% in 2025 (2024: 5.7%). Manufactured exports, particularly electrical and electronics (E&E), will continue to drive this growth, offsetting the decline in commodity exports.

Manufactured exports, which constituted 86% of Malaysia’s total exports in 2024, are projected to expand by 5.5% (2024: 6%). Growth will be led by E&E exports, underpinned by the global technology upcycle. The growth of cloud computing, widespread adoption of AI-powered devices during the replacement cycle and rising demand for devices with enhanced processing capability will continue to drive the broad-based expansion across key end-segments of personal computers, mobiles and servers.

Commodity exports are expected to decline by 1.6% in 2025 (2024: 3.8%) on account of lower oil and gas production due to plant maintenance and lower commodity prices. This is expected to weigh on overall non-E&E exports. Meanwhile, agriculture exports are expected to register sustained growth as crude palm oil (CPO) production continues to expand amid improved labour productivity and fertilisation.

The escalation of geopolitical tensions and trade restrictions as well as unexpected supply disruptions to domestic commodities production pose downside risks to Malaysia’s export growth projections. On the other hand, exports could potentially be higher from stronger-than-expected spillover from the global technology upcycle and more robust tourism activity leading up to Visit Malaysia 2026.

Meanwhile, gross imports growth is expected to moderate to 7.4% from the strong growth last year (2024: 13.2%). Capital imports will continue to increase amid the implementation of investment projects while the growth of intermediate imports will move in tandem with manufactured exports.

Sustained current account surplus

The current account of the balance of payments is expected to continue registering a surplus of 1.5%–2.5% of gross domestic product (GDP) in 2025 (2024: 1.7% of GDP). This is driven mainly by sustained goods surplus amid a lower deficit in the services account.

The goods account is projected to record a surplus of RM118.9 billion (2024: RM117.1 billion), as exports continue to exceed imports. Meanwhile, the services account is expected to post a narrower deficit of RM8.1 billion (2024: -RM13.9 billion), supported by a higher surplus in the travel account, as tourist arrivals and receipts in 2025 are projected to grow further and exceed pre-pandemic levels.

The primary income account is projected to remain in deficit (-RM59.3 billion, 2024: -RM61.5 billion). This is driven by the continued income payment accrued to foreign investors in Malaysia amid improving exports earnings. Similarly, the secondary income account is expected to remain in deficit (-RM10.5 billion, 2024: -RM8.9 billion), due mainly to higher outward remittances by foreign workers. Nevertheless, this is expected to be partly cushioned by higher inward remittances from Malaysians working abroad.