Prime Minister Abdullah Ahmad Badawi today unveiled a 'caring' budget for Malaysians next year laden with immediate and specific measures to further perk up the economy.

According to Bernama , he said these measures were aimed at generating quality growth in the near term to lay a strong foundation for the country's long-term sustainable growth.

Abdullah, who is also finance minister, revealed the 2006 Budget themed 'Strengthening Resilience, Meeting Challenges'.

The government will spend RM136.8 billion for next year, up five percent from this year. Out of this, RM101.3 billion will be for operating expenditure and RM35.5 billion for development expenditure, 13 percent more than this year.

Abdullah said with the government's target of lowering the budget deficit to 3.5 percent of the Gross Domestic Product (GDP) next year from an estimated 3.8 percent this year and 5.6 percent in 2002, the government would have a greater flexibility to focus on development efforts to sustain Malaysia's growth momentum.

Full recovery

"We are fortunate that within a short period of seven years after the 1997 financial crisis, the (Malaysian) economy has fully recovered to achieve sustainable growth. GDP grew at an annual average rate of 5.4 percent during the period. Despite the less than favourable external environment, growth is estimated at 5 percent for 2005," he said.

He said the strong economic performance and fundamentals had enabled Malaysians to enjoy higher income and purchasing power.

Malaysia's per capita income is expected to increase to RM17,741 in 2005 compared with RM16,616 in 2004 while its purchasing power parity is projected to increase to US$10,323 from US$9,630 last year.

In outlining the government's blueprint for the well-being of the people in 2006, which would also be the first year of the Ninth Malaysia Plan (2006-2010), he said the 2006 Budget would have four main strategies:

  • implementing pro-active measures to accelerate economic activities

  • providing a business-friendly environment

  • developing the country's human capital

  • enhancing the well-being and quality of life of Malaysians.