KUALA LUMPUR, Sept. 29 (Xinhua) -- The World Bank on Tuesday revised down Malaysia's growth projection in 2020 to a contraction of 4.9 percent from a 3.1-percent decline previously.
"Following a sharper than expected contraction in the second quarter, the 2020 growth forecast has been lowered to a real GDP contraction of 4.9 percent," World Bank said in its October 2020 Economic Update for East Asia and the Pacific report.
The change in the forecast reflects the heightened uncertainty surrounding the start and speed of the global recovery, which would weigh on investment decisions and external demand, said the World Bank.
The bank also said the elevated unemployment rate and other weaknesses in the labor market would continue to weigh on private consumption.
"Reflecting these developments, most demand components (net exports, private consumption and private investment) are expected to contract in 2020," said the bank.
The Malaysian government expenditure is expected to increase mainly due to stimulus spending, according to the bank.