KUALA LUMPUR (Aug 7): At the start of this year, hopes were high that the economy will stage a strong recovery after the lost year in 2020. Official gross domestic product (GDP) projections were set at 6% to 7.5% of GDP. However, eight months into the year and with many economic sectors unable to operate at maximum capacity due to the lockdown, that hope of a robust recovery has waned.

With the country in lockdown for the most part of 2021, the official GDP forecast is set to be revised lower when the second-quarter GDP reading is released next Friday (Aug 13), Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said during a media interview in July.

Next Friday, many will be closely following what Bank Negara Malaysia (BNM) has to say about economic and financial developments in the second quarter and its assessment of how the economy will perform for the rest of the year. While a full-year 6% growth rate is unlikely to happen this year, there is still hope to see growth rebounding in the fourth quarter should vaccination rates progress as expected. This will enable more states and sectors to open up.

The silver lining amid all the gloom of the pandemic is how Malaysia has been making a sprint in its vaccination efforts in the past month. As of yesterday (Aug 6), 47% of the Malaysian population had been vaccinated with at least one dose of the vaccine, including 25.3% who were fully vaccinated with two jabs.

Undoubtedly, vaccination rates stand as one key factor that will impact economic prospects as we take into account lessons from other countries which have managed to successfully inoculate a significant percentage of their population earlier this year. 

In this issue of The Edge Malaysia weekly, we take a look at five key factors that will determine how well Malaysia performs in the remaining five months of 2021.

Read about it in the weekly's Aug 9 edition by subscribing for a digital copy or have a physical copy delivered to you at home. Stay safe!

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