KUALA LUMPUR, Oct 11 -- Malaysia's growth momentum in 2019 and 2020 is expected to remain steady backed by strong fundamentals and a diversified economic structure despite heightening external uncertainties. 

According to the Economic Outlook released by the Ministry of Finance today, domestic demand will anchor growth with the external factor expanding moderately against the backdrop of a challenging global environment. 

It added that household spending would continue to be driven by stable labour market conditions and benign inflation, while investment activity will be supported by capacity expansion in the services and manufacturing sectors. 

Labour productivity increased to RM91,793 or by 2.5 per cent during the first half of 2019. 

Following various strategies outlined under the Malaysian Productivity Blueprint as well as efforts to improve and enhance the adoption of the Productivity-Linked Wage System (PLWS) among employers, labour productivity is expected to increase 2.6 per cent to RM94,400 throughout the year. 

In 2020, labour productivity is projected to reach RM97,000 or expand by 2.8 per cent due to the growth in the services (3.7 per cent), construction (3.4 per cent) and manufacturing (2.6 per cent) sectors. 

While the economy is expected to remain resilient, the risks to the outlook are still on the downside, arising mainly from moderating global growth and trade activities as well as volatility in the financial and commodity markets, said the report. 

"Moving forward, various measures will be undertaken in sustaining growth momentum and ensuring people's well-being. These include the revival of strategic projects and moving up the value chain through 5G technology and Industrial Revolution 4.0," it added.

In addition, efforts to promote industries that have comparative advantages such as tourism and commodity-related downstream activities are expected to support growth in the near term.

-- BERNAMA