27 Sep - 2 min read
Prime Minister Datuk Seri Ismail Sabri Yaakob has unveiled the 12th Malaysia Plan (12MP) today, sharing that one of the goals featured in the plan includes raising the average household income to RM10,065 per month by 2025. This will contribute to Malaysia’s ambition to become a high-income nation by the same year.
The government expects the gross domestic product (GDP) to grow between 4.5% and 5.5% per annum under the 12MP, led by higher labour productivity growth. From there, it is forecasted to result in a 6.4% per annum rise in gross national income (GNI) per capita, from RM42,503 in 2020 to RM57,882 in 2025. Along with this, salaries and wages are also projected to rise, thereby contributing to higher household incomes, as well as a more even distribution of income between capital owners and employees.
The document also noted that the earlier 11th Malaysia Plan (2016-2020) had aimed to increase the average monthly household income to RM8,960 by 2020. However, actual figures fell short at RM7,160.
The prime minister further highlighted that the Covid-19 pandemic – which began its onslaught on Malaysia in March 2020 – had severely dampened the country’s economic performance. It had caused the country to record an average GDP growth of only 2.7% between 2016 and 2020. Consequently, the GNI per capita in 2020 also came up short at RM42,503.
“This sum is 20% less than the threshold required for a high-income nation,” said Datuk Seri Ismail during the tabling of the 12MP. Additionally, the health crisis also caused the country’s fiscal deficit to widen to 6.2% of the GDP.
Aside from aiming to raise the average household income, the 12MP also targets to eradicate hardcore poverty by 2025 via a whole-of-nation approach. It involves mobilising special units at the federal and district level to consolidate data, programmes, and initiatives by the government, corporate sector, and civil society organisations. The prime minister may also mull on the possibility of introducing a dedicated tax to finance poverty alleviation programmes.
Other notable goals highlighted in the 12MP also include reducing the intensity of greenhouse gas emissions in the GDP to 45% by 2030, inducing growth in various high-impact industries, as well as boosting micro, small, and medium enterprises across the country.
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