KUALA LUMPUR: As Malaysia aims to be among the top 12 most competitive economies globally under the Madani Economy framework, a holistic approach is essential to improve economic performance, government and business efficiency, and infrastructure.
The Economic Outlook 2025 said achieving a competitive economy requires efforts to streamline regulations and reduce bureaucratic barriers through collaboration with the private sector.
It also emphasised the need to improve productivity growth, enhance technological innovation, and empower local talent.
Furthermore, the report noted that Malaysia will strengthen its global competitiveness and secure its position as a leading destination for investment and trade in the Asean region.
The recovery of the global travel and tourism industry positions Malaysia to benefit from an influx of tourists.
"The budget will also focus on upgrading facilities at entry ports to enhance Malaysia's readiness to host numerous nationwide meetings, incentives, conferences, and exhibitions (MICE), including Malaysia's 2025 Asean chairmanship.
"The government will intensify efforts to promote Visit Malaysia Year 2026 through strategic advertising while increasing visibility at the World Expo. This will restore international tourist arrivals to pre-pandemic levels and reaffirm Malaysia's status as a top tourism destination globally," it said.
To diversify tourism, the report said the government will capitalise on the Malaysia My Second Home (MM2H) programme to attract high-net-worth foreign nationals for long-term residency.
It said the focus on MM2H will generate spillover effects for the domestic economy, particularly in real estate, healthcare, and education.
Additionally, the report also noted that the budget will strengthen good management practices, promote environmental, social, and governance (ESG) principles, and adopt advanced technologies among companies.
"Bureaucratic processes will be streamlined to expedite project implementation and enhance governance," it added.
The report also said the 2025 Budget will promote investment in infrastructure, leveraging advanced technologies, and developing skilled talent in relevant fields to support a modern logistics industry.
The budget will lay the foundation for a digital and innovation-driven economy, moving the country towards becoming a high-income nation.
"The government will prioritise cybersecurity across the digital infrastructure network, creating a secure ecosystem that boosts investor confidence," it said.
Meanwhile, the report said the budget will also support efforts in Islamic finance, enhancing Malaysia's credentials as a leader in sustainable finance and development.
For micro, small and medium enterprises (MSMEs), the report said the government will continue providing financing schemes through Development Financial Institutions (DFIs) in the 2025 Budget.
The budget will support commitments to expand renewable energy sources, promote energy efficiency, and ensure the sustainable management of natural resources.
"Improved infrastructure will enhance the distribution and marketing of agricultural products. Regional and international cooperation will be leveraged to intensify the sharing of knowledge and resources, making the agriculture sector more robust and helping Malaysia achieve greater food security and self-sufficiency," it said.