KUALA LUMPUR (Thomson Financial) - The Malaysian government expressed confidence Monday that economic growth will hit 6 percent in 2008 despite troubles in important trading partners such as the United States.
Deputy Prime Minister Najib Razak said domestic demand, public spending and the services and mining sectors, including the booming petroleum industry, would fuel growth.
'Gross domestic product is on the uptrend. And we strongly feel that the 2008 economic growth forecast of 6 percent is within our reach,' he said.
Najib said that while the central bank had predicted slower growth in 2008 than the 6.3 percent rate in 2007 owing to a U.S.-led global slowdown, 'there is enough capacity ... to grow more than that.'
Last week, the central bank, Bank Negara, said Malaysia's growth is expected to slow to 5-6 percent in 2008 from 6.3 percent in 2007.
Bank Negara said rising prices of fuel, commodities and food would see headline inflation rise to 2.5-3 percent from 2 percent in 2007.
'In 2008 the external environment is expected to deteriorate with the continued unfolding of the financial crisis that has erupted in the United States,' central bank governor Zeti Akhtar Aziz said.
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