KUALA LUMPUR – Malaysia will boost salaries for civil servants by more than 13 per cent from December, Prime Minister Anwar Ibrahim said on May 1, amid rising prices, a weak ringgit and plans to reform subsidies.
Datuk Seri Anwar had earlier vowed subsidy cuts and higher taxes in 2024, while re-directing financial aid to the needy. Analysts have flagged risks of inflation and greater fuel costs from the planned cuts, amid falling exports and moderating growth.
The salary increase will involve an allocation of RM10 billion (S$2.86 billion), Mr Anwar said at an event to mark Labour Day.
The government was finalising plans to ensure civil servants a minimum monthly income of more than RM2,000, he added.
Malaysia’s government and central bank expect full-year economic growth of 4 to 5 per cent in 2024, up from 3.7 per cent in 2023, which was a sharp drop from a 22-year high of 8.7 per cent in 2022.
The ringgit has weakened 3.9 per cent against the dollar in 2024, having fallen to a 26-year-old low in February.
The government and central bank have attributed its weak performance largely to external factors, saying they expect it to strengthen this year.
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