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Home Strong focus on regional cooperation in Budget 2025 to boost Malaysia’s Asean chairmanship Budget 2025 Strong focus on regional cooperation in Budget 2025 to boost Malaysia’s Asean chairmanship

By October 10, 2024October 18th, 2024No Comments

KUALA LUMPUR (Oct 10): The Malaysian Institute of Economic Research (MIER) believes that Budget 2025 will have a strong focus on regional cooperation, particularly in fintech, financial inclusion and cross-border trade.

The think-tank said this will further boost Malaysia’s position as it assumes the Asean chairmanship next year.

“The budget will support initiatives that enhance Malaysia’s role in regional trade and economic integration,” MIER said in its pre-budget takeaway entitled “Budget 2025: Shaping Malaysia’s economic future.”

Laos, the current Asean chair, is set to hand over the Asean chairmanship to Malaysia during the closing ceremony of the 44th and 45th Asean Summits in Vientiane on Friday.

Meanwhile, MIER also highlighted the government’s move to further develop Malaysia’s Islamic finance sector, with a focus on venture capital and equity-sharing financial models.

In pursuing sustainable growth of the sector, MIER said these initiatives would support ethical financial practices and align with the government’s broader economic reform goals.

As for manufacturing and industrial growth, the institute said the budget will target sectors such as semiconductors, automotive, and renewable energy, creating high-value job opportunities and driving sustainable growth.

At the same time, tax rebates and corporate support will also be introduced for small and medium enterprises to help manage rising business costs, alongside a tiered levy system for foreign workers.

On green economy and sustainability, MIER expects that the incentives for green technologies, including renewable energy, electric vehicles, and carbon tax frameworks, will be expanded.

A potential carbon trading scheme could also be introduced to support the reduction of emissions, guided by the National Energy Transition Roadmap.

This will encourage the adoption of green energy solutions and energy-efficient equipment to align with environmental, social and corporate governance principles, which are vital for maintaining competitiveness in the global market, added MIER.

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This article first appeared in The EdgeMalaysia on October 10, 2024