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Malaysia to unveil policy changes on Tuesday as oil earnings slide
[KUALA LUMPUR] Prime Minister Najib Razak will announce policy changes, including likely budget revisions, on Tuesday to help Malaysia adjust to the impact of reduced oil and gas earnings due to the slump in global crude prices.
The announcement, scheduled for 10 a.m local time, will be made at Putrajaya International Convention Centre. A press statement will be issued after Najib's speech. "Tomorrow morning I will announce the adjustments that are needed, intervention that is needed in a scenario whereby we need to act more proactively," Najib said on Monday, according to local news portal Malay Mail Online.
Malaysia's 2015 budget, tabled in October 2014, was presented with the assumption that oil prices would have kept to US$100 a barrel, whereas the price of Brent crude has fallen by more than half.
The Malaysian ringgit was emerging Asia's worst performing currency in 2014.
Analysts believe the government needs to reduce its growth forecast, as an unrealistic assumption will lead a sharp rise in Malaysia's debt to GDP ratio.
The government has forecast a 5.0 to 6.0 per cent growth for this year, whereas market forecasts are for around 4.0 per cent growth.