Bangkok, 14 October 2026 – Malaysia aims to reduce its fiscal deficit to below 3% of gross domestic product within two years, using targeted subsidy reform, stronger fiscal discipline and greater private-sector participation to create room for future economic shocks. Finance Minister II Datuk Seri Amir Hamzah Azizan outlined the target during international financial meetings in Bangkok.
The government has already narrowed the deficit from 6.4% of GDP about five years ago to 3.7% last year. That progress gives Malaysia a credible path towards the medium-term objective, but the final stage may be more difficult as higher energy costs, social assistance and development needs compete for public funds.
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