Malaysia Budget 2026: Walking the tightrope between fiscal discipline and populist spending

[KUALA LUMPUR] With state elections looming, Malaysia’s Budget 2026 is expected to walk a fine line between fiscal consolidation and voter-friendly measures.

Prime Minister Anwar Ibrahim – halfway through his term – will unveil the Budget on Friday (Oct 10), the first under the 13th Malaysia Plan (13MP) and the fourth of his premiership since taking office in 2022. The 78-year-old is also Malaysia’s finance minister.

The stakes are high. Anwar’s Madani economic vision calls for sustainable and compassionate development, as his government faces the test of shoring up political support ahead of possible national polls in 2026 or 2027. Out-of-cycle state elections, including Sabah’s state poll in December, add to the political calculus.