KUALA LUMPUR: Malaysia's development expenditure (DE) is estimated to ease by 10.5 per cent to RM86 billion this year, primarily due to lower financial commitment.
However, after excluding the RM13 billion redemption of 1Malaysia Development Bhd bond in 2023, the DE for 2024 reflected a year-on-year increase of 3.5 per cent, said the Economic Outlook 2025.
"DE has been strategically reallocated to priority projects, ensuring optimal resource allocation to align with development planning under the 12th Malaysia Plan 2021-2025," it added.
In terms of disbursement, the economic sector remains the largest beneficiary of the allocation at 48.1 per cent, followed by the social (32.8 per cent), security (14.6 per cent) and general administration (4.5 per cent) sectors.
The allocation for the economic sector is projected at RM41.4 billion.
The transportation subsector accounts for 39.3 per cent of total sector, mainly for ongoing key infrastructure projects such as the Pan Borneo Highway. Klang Valley Double Tracking (Phase 2) and Rapid Transit System Link (RTS Link) between Johor Bahru and Singapore.
The trade and industries subsector, being the second largest, is projected to grow 19.9 per cent to RM3.6 billion due to the establishment of the Industrial Development Fund and Strategic Co-Investment Fund under the New Industrial Master Plan 2030 (NIMP 2030).
The allocation for environment subsector is expected to markedly grow 79 per cent to RM3.3 billion, reflecting a heightened focus on flood mitigation and climate-related disaster projects.
Agriculture subsector estimates a 3.2 per cent growth to RM3.1 billion, with ongoing emphasis to strengthening food security and replantation programmes, as well as maintaining agriculture infrastructure and irrigation systems.
The social sector, the second largest sector, is projected to grow at 16.4 per cent to RM28.2 billion in 2024.
The education and training subsector the largest within the social sector, is estimated to increase by 17.1 per cent to RM14.3 billion.
This allocation is primarily disbursed for the construction and upgrading of schools, training institutions and universities as well as human capital development programmes.
Similarly, disbursements for the health subsector is estimated to increase significantly by 28.1 per cent to RM6.1 billion, predominantly for construction, renovation and maintenance of healthcare facilities nationwide, including hospitals, rural clinics and medical research facilities.
In contrast, the allocation for the housing subsector is expected to decline by 5.1 per cent to RM2 billion mainly due to impending completion of existing projects under the Malaysia Civil Servant Housing scheme.
The allocation for the security sector grew by 10 per cent to RM12.5 billion.
This sector, which comprises the defence and internal security subsectors, is expected to increase by 5.2 per cent and 17.6 per cent to RM7.4 billion and RMS.1 billion respectively.
A substantial allocation is directed towards acquisition of assets such as aircraft and patrol ships, development of the National Integrated Immigration System and construction of police headquarters.
The general administration sector also saw a 20.8 per cent increase to RM3.9 billion. Majority of the allocation focused on enhancing network system, improving asset management and upgrading government offices.