KUALA LUMPUR, June 27 (Xinhua) -- S&P Global Ratings on Tuesday affirmed its 'A-'long-term and 'A-2' short-term foreign currency sovereign credit ratings on Malaysia.
The rating agency said in a statement that it has also affirmed its 'A' long-term and 'A-1' short-term local currency ratings on Malaysia.
The outlook on the long-term rating for Malaysia remains stable, according to S&P.
"The stable outlook reflects our expectations that Malaysia's steady growth momentum and fiscal policy will allow modest improvements in fiscal performance over the next two to three years," said S&P.
S&P also said its ratings on Malaysia are underpinned by the country's strong external position and monetary policy flexibility.
Although Malaysia's budget deficits remain high, S&P expects its growth dynamics to offset vulnerabilities associated with an elevated government debt stock and weak fiscal performance.
Political commitment to resuming post-pandemic fiscal consolidation also exists, according to the rating agency.
Meanwhile, S&P foresees Malaysia's economic growth in 2023 to moderate to 4 percent from a high base effect and a weaker global growth environment.
It also forecasts Malaysia's economy to expand on average 4.5 percent annually from 2024 to 2026.
With this, Malaysia's 10-year weighted average per capita gross domestic product (GDP) growth will be 3.6 percent, which is well above the global median for peers at similar income levels.
Malaysia's real GDP growth accelerated to 8.7 percent in 2022, sustained by strong exports, high energy prices, and pent-up domestic demand following the reopening of the economy. ■
