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ACCCIM Survey Reports

MALAYSIA’S BUSINESS AND ECONOMIC CONDITIONS SURVEY (M-BECS) FOR 【SECOND HALF-YEAR OF 2022 AND PROSPECTS FOR THE FIRST HALF-YEAR OF 2023】

The Associated Chinese Chambers of Commerce and Industry of Malaysia’s (ACCCIM) Malaysia’s Business and Economic Conditions Survey (M-BECS) covers Jul-Dec 2022 (2H 2022) and expectations for Jan Jun 2023 (1H 2023). It was conducted during the period between 15 November 2022 and 31 January 2023 and has received a total of 761 responses.

MBECS Overview and Summary of Key Finding

  1. The Malaysian economy recovery continues in 2H 2022, albeit slower in 4Q. While 60.9% of total respondents having a “Neutral” view about economic conditions in 2H 2022, there was a surge in the percentage of total respondents (24.8%) expecting “Worse” economic conditions, reflecting the impact of slowing exports.
  2. Expectations of better 2H 2023 vs. 1H 2023. Amid concerns about weaker global and domestic economic prospects in 2023, a higher percentage of respondents (28.7%) expect gradual economic improvement in 2H 2023 compared to 19.1% in 1H 2023. For the whole year of 2023, about half of the total respondents (51.1%) expect a “Neutral” economic outlook (vs. 64.3% for 2022).
  3. 24.7% and 20.5% of respondents expect “Worse” business conditions in 2H 2022 and 1H 2023, respectively, weighed down by inflation and rising cost of living pressures, increased business costs, including high prices of raw materials, a gradual hike in interest rate as well as concerns about external uncertainties.
  4. Overall, businesses are cautiously optimistic about the business outlook in 2023. 43.5% and 37.8% of respondents have rated “Neutral” and “Better” prospects, respectively, albeit lower percentages compared to previous survey.
  5. The manufacturing (58.2%) and wholesale and retail trade (41.6%) sectors are holding “Neutral” expectations in 2H 2023. Most respondents in the construction sector see “Better” (44.0%) and “Neutral” (40.0%) business conditions in 2H 2023, respectively, due to positive expectations for property demand and the implementation of mega projects. Tourism (48.1%), transportation and warehousing (50.0%) and professional and business services (52.7%) expect “Positive” business conditions.
  6. Most businesses viewed their cash flows and debtors’ conditions as “Neutral” in 2H 2022 and will likely remain unchanged in 1H 2023.
  7. Increase in prices of raw materials” (51.1%) remained as the top factor that impacted business performance in 2H 2022, followed by “The Ringgit’s fluctuation” (49.7%); “High operating cost and cash flow problem” (45.1%); “Shortage of workers” (43.0%); and “Political climate” (32.9%).
  8. Business assessment in 2H 2022 and 1H 2023F:a) Sales performance0% of respondents across most sectors have experienced an increase in sales in 2H 2022.
    a) 53.9% are optimistic about their sales prospects in 1H 2023.
    b) Business operationsStrong demand has improved production in 2H 2022. Nearly half of total respondents are likely to increase their production in 1H 2023.
    c) Cost of raw materials: More than 70% of total respondents revealed that both prices of local and imported raw materials have increased in 2H 2022. Most of them expect cost increases to persist in 1H 2023.
    d) Manpower9% of total respondents have increased their manpower in 2H 2022. More than half of respondents increased their employees’ wages in 2H 2022 to comply with the new minimum wage. Nearly 70% of total respondents will likely increase their employees’ wages in 1H 2023.
    e) Capital expenditure: Most respondents have increased their capital expenditure in 2H 2022 and will continue to invest further in 1H 2023 despite cautiousness about the economic prospects.

 

Click here for the Executive Summary

Click here for the Full Report

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