Malaysia’s new government sets bigger budget for next year, with priority on education and entrepreneurs
- Over 19 per cent of total budget allocated for education, with defence budget slashed by over 10 per cent
- Budget deficit will be pushed to the highest in five years, with reliance on oil revenue from state oil company Petronas
Malaysia’s Pakatan Harapan government on Friday announced a federal budget that prioritises institutional reform, the promotion of entrepreneurship and the socioeconomic well-being of Malaysians.
The 2019 budget, the first to be tabled by a non-Barisan Nasional government in six decades, pledged close to 20 per cent of the budget on education, with funding of 60.2 billion ringgit (US$14.5 billion).
In doing so, the second Mahathir administration pushed its budget deficit to the highest in five years, upending expectations of modest spending growth.
It will fill the gap by more than doubling reliance on oil revenue from state oil company Petronas, in stark contrast to the efforts of the previous Najib Razak-led administration.
But in what may be seen as an effort to avoid over-dependence on a primary commodity, it also emphasised the importance of building an entrepreneurial state and boosting the performance of the SME sector, which comprises 98.5 per cent of businesses in Malaysia.