Good performance: According to the IMF, Malaysia’s economy expanded at a healthy pace in 2025 and has shown ‘notable resilience against global trade tensions and policy uncertainty’. — AZMAN GHANI/The Star
IT was the kind of uplifting news that the federal government could do with to wrap up the year.
The International Monetary Fund (IMF) has announced that Malaysia’s economy expanded at a healthy pace in 2025, driven by strong domestic demand.
The IMF also noted that Malaysia had shown “notable resilience against global trade tensions and policy uncertainty”.
In a statement released recently, the IMF said growth this year was underpinned by robust consumption and investment, solid employment gains, and a global technology upcycle.
The IMF said this performance, in part, reflects sound economic policies and prudent macroeconomic management. However, it cautioned that external risks could weigh on growth in 2026 as global uncertainty becomes “a new normal”.
At the same time, it must be recognised that the ringgit has performed very well against the US dollar and is poised to do well in 2026.
It has performed strongly recently, becoming a top Asian currency, driven by our robust economic growth, improved investor confidence, and a weaker dollar. The ringgit, in fact, has outperformed many regional peers against the dollar.
Last week, the ringgit climbed to another new high at Tuesday’s closing, touching RM4.0615, the strongest level last seen in early March 2021, as expectations of a US interest rate cut continued to pressure the greenback.
Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said the ringgit continued to appreciate further, as anticipation of an interest rate cut in the US remained the key factor driving the weaker US dollar.
“Clearly, foreign exchange traders are constructive on the ringgit in the near-term, and RM4 seems to be the next level.”
Despite the impressive economic show, there has been much criticism against Prime Minister Datuk Seri Anwar Ibrahim. The critics says he came into office with a strong reformasi/anti-corruption mandate but the pace and depth of reform have fallen short.
Civil society and reform advocates argue that promised changes, especially anti-corruption, judicial and governance reforms, have been slow.
Long-awaited changes to institutional independence, political financing, and civil liberties have often stalled at the discussion stage.
But take away all the political expectations and whining, how did the government fare exactly?
The past year for the Malaysian government has been neither a triumph nor a failure, but a study in incrementalism – marked by a few genuine high points and some disappointments.
But the government’s most underappreciated achievement this year has been political stability. Many of us have taken this for granted but without this stability, no investor will put their money here.
We keep forgetting we have had three prime ministers since 2018 and despite the criticism against Anwar, he has outlasted all of them.
Most coalition governments never last but he has held the reins for three years and still commands majority support among Members of Parliament.
It is the Opposition that is in disarray, actually.
The durability of the unity government matters. It has allowed ministries to plan beyond crisis management and given investors, civil servants, and ordinary citizens a sense – however fragile – that tomorrow will not bring another abrupt reset.
On the economic front, the government deserves credit for resisting populist temptation.
Budget measures, while hardly generous, were largely pragmatic, focusing on targeted assistance rather than blanket giveaways.
The continued emphasis on subsidy rationalisation, though unpopular, signals a recognition that Malaysia cannot indefinitely fund inefficiency without undermining its fiscal future.
That the government has tried, however cautiously, to explain this logic to the public is itself progress but it has not been easy.
Still, the public expects reforms to be fast tracked in 2026. The language of reform has to be met with deliveries.
The ringgit has appreciated and IMF has praised us, but all this must be felt by the ordinary people.
Renewed anti-corruption rhetoric has helped restore some credibility to governance after years of scandal-driven cynicism but we also want to see formal legal charges.
We read of so many high-profile cases involving Tan Sris and Datuks and yet many have yet to be formally charged, including the fraudulent MBI Group ponzi scheme.
While we demand more anti- corruption drives, it is odd that many of us still insist on amnesty, including pardons, for elites who have committed grave corruption. It is an oxymoron.
Internationally, Malaysia has benefited from a more coherent foreign policy voice. As the Chair of Asean, Anwar has performed incredibly well and it will be a tough act to follow.
The government has balanced relations with major powers carefully, defended national interests without unnecessary theatrics, and reaffirmed Malaysia’s relevance in Asean at a time of growing regional uncertainty.
Even Anwar’s biggest critics have admitted that he did well on the regional and international stage, including his handling of the visit by unpredictable US President Donald Trump to Malaysia.
But Malaysians expect Anwar to spend more time at home in 2026 as we head towards a general election in a year or two. Certainly the ground work has to begin soon.
While trips abroad are necessary to attract investments, he also needs to focus his time on the ground for Malaysians.
For many Malaysians, foreign achievements feel abstract when measured against daily realities.
The cost of living remains the government’s most persistent vulnerability. Food prices, housing affordability, and wage stagnation continue to erode public confidence.
Explanations about global inflation or structural constraints may be accurate, but they offer little comfort at the pasar.
In some cases, the government appears constrained by its own coalition arithmetic; in others, by an understandable but frustrating aversion to political risk.
The result is reform fatigue among supporters and vindication for critics who argue that Malaysia’s political culture changes far more slowly than its slogans.
Equally damaging has been the persistence of racial and religious grandstanding on the political fringes – and sometimes uncomfortably close to the centre.
Malaysians often wonder why certain serial stirrers are able to get away with it – is it because they belong to a component party in the ruling coalition?
The government’s responses have been cautious to the point of ambiguity, leaving it open to criticism for failing to draw firmer lines in defence of moderation and pluralism.
Finally, communication remains a weak spot. Policies are sometimes announced without sufficient groundwork, inviting backlash that might have been mitigated with clearer messaging and earlier engagement.
Where are the Pakatan cybertroopers as the PM gets hammered on social media?
While the Madani government has kept the ship steady in choppy waters, it has to do more to convince many Malaysians.
The Madani government has kept the ship steady in choppy waters, but has to do more to convince many Malaysians. — Bernama
Yes, many Malaysians know that there are no viable options besides PMX now.
Certainly many do not want to see discredited parties being returned to power although they can tolerate these parties as part of a coalition.
The worst scenario is to see a theologian party coming into power, specifically PAS, which some see their disciplined followers turning Malaysia into the dark ages.
Angry voters who used to be supportive of Pakatan may insist on staying home as a protest, but they can be sure that the PAS faithful will turn up in full force.
There has to be rational answers to the whining and grumbling.
But Pakatan must take heed that they should be voted in again – not because there are no options but because voters are convinced they are the best option. Not out of necessity.
As the new year approaches, the challenge is clear. Stability must now be converted into delivery; rhetoric into results. The year 2026 has to be a year of deliveries as the clock ticks away.
