MONEY MASTER

Singapore’s Budget 2025 delivers a balanced fiscal outlook with a  SGD 6.8bn surplus  (0.9% of GDP), buoyed by a robust Net Investment Returns Contribution (NIRC) of 3.6% of GDP. Despite significant spending priorities, the government’s measures are set to stimulate consumer spending, technology innovation, and renewable energy initiatives. DBS has identified six key takeaways that highlight which segments are likely to benefit and which may face limited impact. Key Budget Highlights Winners: Grocers & Retail Malls: The SG60 package, CDC vouchers, and other handouts are estimated to provide  SGD 1.1bn in grocery support . DBS projects that a total of  SGD 1.7bn in CDC/SG60 vouchers  will boost supermarket sales and retail mall performance—driving a significant shift from cash to vouchers. Technology & Semiconductor Sectors: A  SGD 3bn top-up  to the National Productivity Fund, alongside a  SGD 1bn semiconductor R&D fabrication facility...

The Madani Government has demonstrated its commitment to addressing the cost-of-living challenges faced by Malaysians through an enhanced  Sumbangan Tunai Rahmah (STR)  initiative. With an allocation increase to  RM13 billion  in Budget 2025, up from RM10 billion previously, this marks the largest funding boost for STR to date. Supporting Households Amid Rising Costs Economist  Prof Dr Barjoyai Bardai  from Malaysia University of Science and Technology emphasized the importance of STR in easing financial burdens for households. While the aid may not cover the full cost of living for families—estimated at over RM3,000 monthly—it provides meaningful support to supplement household incomes. Sustainable Aid Mechanism Proposed Barjoyai suggested creating an  endowment fund  through a social security institution capable of generating annual income. This mechanism would ensure sustainable STR funding, reducing reliance on annual government budgets. Expan...

The governance pillar of the  Environmental, Social, and Governance (ESG)  framework, often overshadowed by its environmental and social counterparts, is receiving greater emphasis under Malaysia’s  Budget 2025 . These reforms are aimed at ensuring  transparency ,  accountability , and  socio-economic equity , creating a foundation for a more  resilient and inclusive Malaysia . Key Highlights of Governance Reforms 1. Fiscal Responsibility and Subsidy Reforms The government is narrowing the  fiscal deficit to 3.8% of GDP  in 2025 (from 4.3% in 2024). Subsidy Rationalisation : Phasing out blanket subsidies in favor of  targeted assistance  to benefit vulnerable groups. Savings will increase  Sumbangan Tunai Rahmah  allocation from  RM8 billion to RM10 billion , supporting 9 million recipients. Revenue Boost: Sales and Service Tax (SST)  expansion. 2% dividend tax  on income exceeding RM100,000 annually. 2. Pub...

The Malaysian government’s RM421 billion Budget 2025 signals a transformative approach to economic growth, emphasizing the well-being of the rakyat over costly mega-projects. Prime Minister Datuk Seri Anwar Ibrahim’s Ekonomi Madani framework aims to address inefficiencies, uplift living standards, and create an inclusive society while fostering sustainable growth. Key Pillars of Budget 2025 Raising the Ceiling : Boosting national productivity through high-value investments. Raising the Floor : Enhancing social security and living standards. Strengthening Governance : Improving fiscal discipline and transparency. Driving High-Value Investments Budget 2025 focuses on attracting investments in sectors such as: Electrical and electronics (E&E) Green industries Semiconductors Initiatives include: New investment incentives (3Q2025). Expanded export tax incentives for integrated circuit (IC) design. Tax deductions for AI, robotics, and FinTech courses. Strategic projects like the J...

The Dewan Rakyat will today deliberate on critical issues surrounding low-cost housing and government quarters, with a focus on implementing new policies and solutions for long-standing challenges. Key Topics on the Agenda Effectiveness of COB and Local Authorities During the  Minister’s Question Time at 10 a.m. ,  Suhaizan Kaiat (PH-Pulai)  will question the  Minister of Housing and Local Government  about the performance of the  Commissioner of Buildings (COB)  and local authorities (PBT) in addressing infrastructure issues in low-cost flats. Exit Policy for Public Housing Roslan Hashim (Kulim Bandar Baharu)  will propose an  exit policy  for public housing residents. This initiative seeks to encourage long-term tenants, especially those who have lived in public housing for over 10 years, to  purchase homes . The policy aims to  free up rental units  for new civil servants and reduce rental demand. Teen Mental Health Cri...

As Malaysia’s Budget 2025 approaches, there is growing speculation that food subsidy cuts may be on the table, particularly for eggs. While fuel subsidy rationalization is expected to take center stage, food-related subsidies might also be trimmed as the government seeks to manage its enormous subsidy bill . Despite the small share of food subsidies compared to fuel, the government has emphasized the need for targeted subsidies . Economists note that while savings from food subsidy cuts would be minimal, it may be a first step toward broader subsidy reforms. Food subsidies for items such as cooking oil, rice , and eggs currently account for RM3.18 billion of the RM52.8 billion in subsidies and social assistance allocated for 2024. Eggs, which receive a 10 sen subsidy per egg , amounting to around RM100 million , are a prime candidate for subsidy cuts. Economists suggest that allowing market forces to set egg prices could stabilize costs, similar to the approach taken for chicke...

Malaysia’s consumer and construction stocks are poised to benefit from Budget 2025 , as Prime Minister Datuk Seri Anwar Ibrahim is expected to introduce measures aimed at lowering the cost of living and unveiling infrastructure projects . As both Prime Minister and Finance Minister, Anwar will likely announce targeted cash transfers , civil servant salary hikes , and potential revisions to the minimum wage to boost disposable incomes, supporting retailers like AEON Co and Padini Holdings . In the construction sector, analysts expect the budget to include new projects such as the Mass Rapid Transit Line 3 and Pan Borneo Highway , with companies like Gamuda , Sunway Construction , and IJM Corp set to benefit. There could also be updates on the Johor-Singapore High-Speed Rail and cross-border economic zones, reigniting interest in the sector. The government’s commitment to growing semiconductor industries may lead to support measures for data center developers like YTL Power Int...

As Malaysia gears up for Budget 2025 , all eyes are on the government's expected implementation of the Global Minimum Tax (GMT) , set to take effect on January 1, 2025 . This tax policy aligns with the OECD Global Anti-Base Erosion (GloBE) Model Rules under Pillar Two , aimed at curbing profit shifting by multinational enterprises (MNEs) to low-tax jurisdictions. The GMT sets a minimum tax rate of 15% for MNEs, and Malaysia plans to adopt a Domestic Top-Up Tax (DTT) to ensure compliance with these global tax rules. Potential Impact on Malaysia’s Investment Competitiveness While Malaysia has long been a competitive destination for investments, the introduction of GMT raises concerns about maintaining this edge. According to Soh Lian Seng , head of tax at KPMG in Malaysia , the country may lose appeal if alternative incentives or strategic tax reforms are not introduced. This sentiment echoes fears that MNEs benefiting from local incentives may relocate to countries offering mor...

The federal government's financial performance in 2023 showed improvement compared to 2022, with excess revenue increasing by RM2.028 billion , according to the Auditor General's (AG) Report . Additionally, the government's deficit decreased by RM8.595 billion , bringing the deficit-to-GDP ratio down to 5.0% from 5.5% in the previous year. However, the report highlighted concerns over the increasing trend of federal liabilities , which consist of federal debt and financial liabilities. These liabilities grew by RM92.038 billion (6.6%) to reach RM1.492 trillion in 2023, up from RM1.400 trillion in 2022. Furthermore, the government's guarantee commitment for 13 companies increased by RM3.288 billion (1.5%) . At the same time, dividends received by the federal government fell significantly, decreasing by RM9.756 billion (17.5%) , down from RM55.815 billion in 2022. Despite these challenges, the AG Report stated that the federal government’s financial statements pre...

The Auditor General's (AG) Report revealed that 3,942 projects , or 45.9% of the 8,593 development projects under the 12th Malaysia Plan (12MP) , were in progress as of Aug 26, 2024 . However, 169 of these projects are experiencing delays or difficulties. According to the AG’s Report 3/2024 on the federal government’s 2023 financial statements, which was presented in Parliament, 1,434 projects have reached the post-implementation stage, 3,085 projects are still in the pre-implementation phase, and 132 projects have been either cancelled or are under review. To ensure the completion of these projects by 2025 , the AG recommended more rigorous monitoring and immediate interventions . The performance of 12MP projects will be fully assessed at the plan's end in 2025, with the government emphasizing improved efficiency and monitoring under the Mid-Term Review of the 12MP , presented in September 2023. From 2021 to 2023, the expenditure on 12MP projects amounted to RM231.92 ...

Kenanga Investment Bank Bhd (Kenanga IB) anticipates the Malaysian government to increase its development expenditure (DE) to RM94.5 billion in Budget 2025 , up from RM88.5 billion in 2024. This rise is expected to enhance infrastructure projects such as the revival of the Mass Rapid Transit 3 (MRT3) and the Kuala Lumpur-Singapore High-Speed Rail (KL-SG HSR) . Kenanga IB highlighted that in addition to transport, other key DE spending will likely focus on agriculture, education, healthcare, affordable housing, and national security , amid increasing regional tensions. On the operating expenditure (OE) front, Kenanga IB projects a rise to RM306.5 billion , despite the expected removal of the RON95 blanket fuel subsidy in the second half of 2025. Savings from this move could be redirected towards targeted assistance, civil servant salary increases, and progressive wage policies . The government's revenue is expected to rebound by 4.3% to RM316.5 billion in 2025, driven by reven...

Budget 2025 will integrate feedback and recommendations from various industries and citizens across the country, gathered through extensive engagement sessions, according to Treasury Secretary General Datuk Johan Mahmood Merican . Johan mentioned that his team is in the final stages of preparing Prime Minister Datuk Seri Anwar Ibrahim's budget speech , which is set to be delivered on Oct 18 . “The prime minister will present Budget 2025 this Friday, following consultations with stakeholders. We are now finalizing the speech,” he said, speaking after the Financial Run 2024 , an event organized in conjunction with National Sports Day. The Budget 2025, themed " Madani Economy, Prosperous Nation, Well-being of the People ," aims to introduce structural economic reforms to ensure that Malaysia's economic growth is shared equitably. It will be the last budget under the 12th Malaysia Plan (2021-2025) before the transition to the 13th Malaysia Plan. Prime Minister Anwar ...

Edotco Group Sdn Bhd CEO Mohamed Adlan Ahmad Tajudin has called for green bonds, tax breaks, and rebates in Budget 2025 to encourage telecommunication companies (telcos) to transition to renewable energy (RE) . He stated that such incentives could help offset the high upfront costs associated with adopting clean energy sources like solar and wind. Mohamed Adlan also suggested the introduction of cash-back programmes for environmental, social, and governance (ESG) initiatives, similar to those for electric vehicles, which could attract telcos to integrate sustainability practices . He further highlighted the potential for green bonds and competitive financing options for RE projects, coupled with ESG reporting standards , to provide financial support and encourage companies to take more decisive actions on sustainability. However, he noted that challenges such as rising energy costs and the geographically dispersed nature of telco networks make implementing energy-efficient so...

TA Securities Holdings Bhd expects Budget 2025 to feature an allocation of RM403.7 billion , with RM305.7 billion allocated for operating expenditure and RM97.9 billion for development expenditure. This forecast suggests a reduction in the fiscal deficit to 3.7% of GDP in 2025, down from a projected 4.2% in 2024 , moving towards the government's 3.5% target by 2026 . The growth in government revenue, forecasted to rise 5.7% to RM325.3 billion , will be driven by increases in both direct and indirect taxes , as the economy expands at an expected rate of 5% in 2025. The services and manufacturing sectors , along with wage increases and private investments , are projected to support this growth. Key initiatives in Budget 2025 are expected to include measures supporting public infrastructure projects like the Mass Rapid Transit 3 (MRT3) and high-speed rail (HSR) , digital economy investments , and sustainable development related to energy transition . Additionally, sectors l...

Indonesia has adjusted its 2025 budget deficit projections, indicating a smaller shortfall than previously estimated. This update provides key insights for those interested in global markets and the economy. Key Updates: Budget Deficit Adjustments: New Target Range: The 2025 budget deficit is now projected to be between 2.29% and 2.82% of GDP, lower than the previous lower estimate of 2.45%. Revenue Strategies: Indonesia plans to boost state revenues by expanding the tax base and optimizing fiscal incentives. Additionally, streamlining energy subsidies will free up more funds. Economic Impact: Investor Confidence: Keeping the deficit below the legal limit of 3% of GDP aims to reassure investors, particularly as President-elect Prabowo Subianto prepares to implement new initiatives, such as a US$4.3 billion free meal project. Debt Ratio Target: Lawmakers approved a target debt ratio of 37.82%-38.71% of GDP for 2025, improving from roughly 39% this year. This move indicates a commitm...