Strong domestic demand to spur state’s economy

Strong domestic demand to spur state’s economy

Posted on November 20, 2012, Tuesday

KUCHING: Sarawak’s economy is projected to expand by five per cent in 2013.

Chief Minister Pehin Sri Abdul Taib Mahmud said the growth would be supported by stronger domestic demand generated by the dynamic economic activities of on-going projects in the Sarawak Corridor of Renewable Energy (SCORE) and projects under the 10th Malaysia Plan (10MP).

“Our state economy is expected to record a favourable growth of 4.5 per cent this year,” he said when tabling the Sarawak Budget 2013 at State Legislative Assembly Complex yesterday.

Taib said the state government anticipated private investments to expand by 10.4 per cent next year, thanks to the progress made in the SCORE area as well as the Economic Transformation Programme.

“The strong growth in private investments for the first half of 2012 was also reflected in several key investment indicators.

“These include the importation of capital and intermediate goods that grew by 10.3 per cent and 19.4 per cent respectively for the period.”

Taib who is also the Finance Minister said the government would carry on putting in place the essential infrastructure facilities, improving public sector delivery and its on-going initiatives in attracting foreign and local investments.

Taib said public investment would continue to support growth and development in the state with an estimated expansion of 3.3 per cent in 2013.

On the supply side, he said the manufacturing sector would continue to do well next year with an expected growth of 5.7 per cent.

“The growth will be supported by robust demand for our resource-based sub-sectors and commencement of operation of industries in Samalaju Industrial Park.”

Growth of the construction sector, he said, would be further accelerated by 10.5 per cent in tandem with the implementation of the state’s development projects.

“The construction sector itself is expected to grow at nine per cent in 2012 boosted by the on-going implementation of various government projects under the 10MP, major construction projects in the SCORE area and the Murum hydro power dam.”

He said the mining and quarrying sector and agriculture sector were expected to grow at two per cent and 3.3 per cent respectively next year.

The services sector was projected to grow by 5.8 per cent in 2013 he added.

On external trades, Taib said gross exports were expected to grow at five per cent in 2012 due to strong demand for our agricultural commodities mainly palm oil and timber products.

For the first half of 2012, export volume of palm oil increased by 9.4 per cent despite lower export prices while export volume for timber products such as sawn timber increased by 10.9 per cent, veneer sheets (7.7 per cent) and plywood (8.6 per cent), he disclosed.

“Overall, the gross export receipt increased by 17.1 per cent partly due to higher commodity prices of our major exports namely LNG, crude petroleum and petroleum products.

“During the same period, gross imports expanded by 25.3 per cent driven mainly by strong growth of imports of capital and intermediate goods in tandem with the growth of investment in the state.”

Taib noted that the state registered an inflation of 1.8 per cent in the first half of 2012, largely due to the stable price of food and non-alcoholic beverages.

“For 2013, inflation rate is expected to remain below three per cent.”

On employment, he said the Labour Department reported 40,875 vacancies in the first half of this year, an increase of 21 per cent against the corresponding period of 2011.

Earlier, Taib also deliberated on the world economic performance 2012 and prospects for 2013.

He pointed out that even the International Monetary Fund had revised downward the global growth for 2013 to 3.6 per cent compared to earlier forecast of 3.9 per cent.

“We have to keep abreast not only on the latest external development but also to anticipate the possible outcomes that would have impact on the development of the various sectors of the state’s economy.”