Who are we

The Malaysian Institute of Economic Research (MIER) undertakes independent and high quality problem-oriented research on economic, financial and business issues facing the country and provides advice on macroeconomic management, development and future economic perspectives. In undertaking this task, the Institute seeks to achieve the following objectives:

  • Serve as a bridge between the government, the private sector and the universities, and become a focal point for economic, financial and business research in the country;
  • Undertake economic research projects commissioned by clients in the public and private sectors;
  • Collaborate with other research institutes, at home and abroad, on topics of relevance to the country;
  • Publish and disseminate the results of its research work, and organise symposia and conferences to promote exchange of ideas and views;
  • Provide occasional training for officials from government agencies and private sector organisations; and

In recent years, the above goals have been extended to cater for the research and training needs of countries outside Malaysia as well.

The Malaysian Institute of Economic Research (MIER) is an independent, non-profit organisation devoted to economic, financial and business research that serves as a think-tank for the government and the private sector. It was first mooted in the Prime Minister’s Economic Panel and later promoted by the Council on Malaysian Invisible Trade (COMIT). It was incorporated as a company limited by guarantee on 30 December 1985 and began operations on 2 January 1986.

The research activities of the Institute are organised into four research divisions, namely, Macroeconomic Surveillance and Forecasting, Policy Studies, Industry Studies and Area Studies (see Chart). The research projects undertaken by the Institute are mainly applied and policy-oriented in nature.

The Institute is governed by a Board of Trustees, which sets its policy directions. An Advisory Panel provides guidance to the Institute in the planning of its research activities. The Executive Director is the chief executive officer, supported by a team of full-time research and support staff members. The Institute also engages a number of associate research fellows and consultants, in addition to hosting interns, both local and foreign.

The Institute’s activities are funded partly by investment income from an Endowment Fund established with contributions from private corporations and the government. The Institute currently also receives an annual grant from the Government of Malaysia. Direct project funds as well as consultancy fees make up the bulk of the Institute’s budget.

The external trade for this year remains challenging as global growth is dwindling. Growth in exports is expected to moderate at 1.5%, a 0.4 percentage point reduction from MIER's earlier projection, as certain downside risks became clearer. Imports growth is also revised downwards by 0.3 percentage point to grow at 1.9%. Both exports and imports are expected to grow faster next year by 3.7% and 4.5%, respectively. The growth of exports of manufactured goods are expected to deteriorate, including for E&E products which accounted for about 40.0% of total exports. This is largely due to the knock-on effect of the US-China trade war. The December manufacturing PMI has shown that China's manufacturing output has contracted, alongside with an even larger contraction for Malaysia's manufacturing output.

The world commodity outlook for this year is not expected to be exiting either. The agriculture sector is projected to grow at a slower pace for this year at 1.3% compared to the impressive growth of 7.2% in 2017. The growth was haunted by sluggish demand and lower prices for palm oil and palm oil-related products. Although the demand from the two largest importers, India and China is improving, a large inventory accumulation in Malaysia and Indonesia exerts a downward pressure on the already cheap prices. Nevertheless, the effect of El Nino is still probable to bring the supply down. Meanwhile the campaign against palm oil by Europe continues to tarnish the industry. Exports of palm oil and palm oil-based products together with oil & gas-based products accounted for about 23.0% of total exports.

The demand for petroleum products is also bleak amid a slower global growth. Meanwhile, crude prices are pressuring downwards due to the oversupply condition. OPEC bids to cut production would be futile as America's shale oil production continues to rise. The beginning of 2019 sees the oil market is gradually rebalancing as the US shale growth is slowing down and OPEC started to cut production. Nevertheless, the weaker than expected growth in China that will further weaken oil demand could upset the market again. Oil prices for this year are expected to settle in the range of USD60-70 per barrel, depending on the demand condition.

Pending the fourth quarter data, current account (CA) of the balance of payments (BOP) for last year is expected to remain in surplus but estimated to be tapering down to RM36.3 billion. The three-quarter balance of the CA now stands at RM22.7 billion. The third quarter CA balance was RM3.8 billion, lower than the previous two quarters. The declining CA balance is partly due to a weakened global demand. Meanwhile, the deficits in the services account, as well as in the primary and secondary accounts, are not expected to improve. This year CA balance is projected to be 2.5% of GNI.

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