2018 BUDGET

1 Ministry of Finance MalaysiaNo. 5 Persiaran Perdana Presint 2, Federal Government Administrative Centre, 62592 WP PUTRAJAYAMINISTRY OF FINANCEMALAYSIA2018 BUDGET9 789834 351281978-983-43512-8-1 ISBN2018 BUDGETC over Ucapan BI 110/28/17 6:43 PM2018 BUDGETM inistry of Finance MalaysiaWJD009870 Title Page 110/28/17 8:44 PM Copyright Reserved All rights reserved. No part of this publication may be reproduced, stored in retrieval system or transmitted in any form or by any means electronic, mechanical, photocopying, recording and/or otherwise without the prior permission of: Undersecretary, Fiscal and Economics Division, Ministry of Finance Malaysia, Level 9, Centre Block, Kompleks Kementerian Kewangan, No. 5, Persiaran Perdana, Precint 2, Federal Government Administrative Centre, 62592 Putrajaya.

2 Fax: 03-88823881 E-mail: BUDGET Speech is an annual publication released on the same day as the Annual BUDGET . The 2018 edition is released on 27 October 2017. Perpustakaan Negara Malaysia Cataloging in Publication Data Malaysia, Kementerian Kewangan BUDGET SPEECH 2018 / [Kementerian Kewangan Malaysia] ISBN 978-983-43512-8-1 1. BUDGET Malaysia. 2. Government spending policy Malaysia. 3. Speeches, adresses, etc. I. Mohd. Najib Tun Haji Abdul Razak, Dato Sri, 1953 II. Title III. Title : BUDGET 2018 Layout and Printed by: Percetakan Nasional Malaysia Berhad, Jalan Chan Sow Lin, 50554 Kuala Lumpur. Tel.: 03-92366888/92366894 Fax: 03-92011008/92224773 E-mail: This publication is also available for download at: Cover Design by Fiscal and Economics DivisionPRINTED BYPERCETAKAN NASIONAL MALAYSIA BERHADKUALA LUMPUR, : 03-92366894 Fax: 03-92224773 WJD009870 Title Page 210/28/17 8:44 PMBUDGET 2018iiiContentsPageINTRODUCTION2 ECONOMIC PERFORMANCE AND CHALLENGES32018 BUDGET ALLOCATION5 FIRST THRUST: INVIGORATING INVESTMENT, TRADE, AND INDUSTRIES - Strengthening Small and Medium Enterprises - Strengthening Microfinancing - Accelerating Exports - Boosting Agricultural Sector - Boosting Tourism Industry - Driving Logistics Sector - Strengthening Financial MarketSECOND THRUST.

3 TOWARDS TN50 ASPIRATION - Improving Childcare and People with Disabilities Welfare Centres - Inculcating the Culture of Savings in TN50 Generation - Providing Education for TN50 Generation - Upholding Higher Education - Upholding Talent and Careers of TN50 - Sports Development8910101112141618181819192121 WJD009870 Title Page 310/28/17 8:44 PMivBUDGET 2018 THIRD THRUST: EMPOWERING EDUCATION, SKILLS, TRAINING AND TALENT DEVELOPMENT - Upgrading and Maintaining Schools - Providing Schooling Assistance - Funding for Higher Education - Providing Skim Simpanan Pendidikan 1 Malaysia - Enhancing Technical and Vocational Education TrainingFOURTH THRUST: DRIVING INCLUSIVE DEVELOPMENT - Providing Quality Infra-Rakyat - Implementing National Blue Ocean Shift - Safeguarding the Welfare of FELDA Settlers - Enhancing Safety and Security - Introducing the Bumiputera Wellbeing Transformation Policy - Safeguarding the Wellbeing of Chinese and Indian Communities - Safeguarding the Welfare of Orang Asli - Safeguarding the Women and Family WellbeingFIFTH THRUST.

4 PRIORITISING THE WELLBEING OF THE RAKYAT AND PROVIDE OPPORTUNITIES TO GENERATE INCOME - Generating Rakyat s Income - Increasing Disposable Income - Enhancing 1 Malaysia Retirement Scheme - Hiring Foreign Domestic Helpers - Housing - Improving Quality Healthcare - Goods and Services Tax2222232324252525272728293132333434343 637373840 WJD009870 Title Page 410/28/17 8:44 PMBUDGET 2018vSIXTH THRUST: FORTIFYING THE FOURTH INDUSTRIAL REVOLUTION AND DIGITAL ECONOMY - Industrial Revolution - Promoting Sustainable Development - Establishing Digital Free Trade Zone - Expanding Regulatory SandboxSEVENTH THRUST: ENHANCING EFFICIENCY AND DELIVERY OF GOVERNMENT-LINKED COMPANIES AND PUBLIC SERVICE - Benefitting Employees in Government-Linked Companies - Prioritising the Welfare of Senior Citizens, People with Disabilities and Children - Improving Public Sector Home Financing BoardEIGHTH THRUST: BALANCING BETWEEN THE PAR EXCELLENCE OF WORLDLY AND HEREAFTER - Socioeconomic Research Institute - Appreciating Public Servants - Supporting Neighbourhood and Community - Upholding the Greatness and Integrity of Islam4141424343444445454646474849 CLOSING49 APPENDICES 53 WJD009870 Title Page 510/28/17 8.

5 44 PMviBUDGET 2018 Thus far no BUDGET has been crafted so well like this, even since I took over office, as it is holistic and full of philosophies and can be marked in history, making this BUDGET The Mother of All Budgets. YAB Dato Sri Mohd Najib Tun Haji Abdul Razak Prime Minister and Minister of Finance MalaysiaWJD009870 Title Page 610/28/17 8:44 PMBUDGET 2018viiYAB Dato Sri Mohd Najib Tun Haji Abdul Razak Prime Minister and Minister of Finance MalaysiaWJD009870 Title Page 710/28/17 8:44 PMviiiBUDGET 2018 THE ECONOMY 2018AT CONSTANT 2010 OF OFSERVICES ,003,814millionRM2,003,814million1 Includes change in stocks. Source: Ministry of Finance, 2018 FEDERAL GOVERNMENT BUDGET WHERE IT GOESWHERE IT COMES FROM1 Includes revenue, borrowings and use of Government's Excludes contingency DIRECT ANDSOCIAL ANDTRANSFERS TOSTATE ,2501millionRM280,2502millionDEVELOPMENT EXPENDITUREOPERATINGEXPENDITURES ource: Ministry of Finance, AND USEOF GOVERNMENT'S Title Page 810/28/17 8:44 PMBUDGET 2018ixTHE ECONOMY 2018AT CONSTANT 2010 OF OFSERVICES ,003,814millionRM2,003,814million1 Includes change in stocks.

6 Source: Ministry of Finance, 2018 FEDERAL GOVERNMENT BUDGET WHERE IT GOESWHERE IT COMES FROM1 Includes revenue, borrowings and use of Government's Excludes contingency DIRECT ANDSOCIAL ANDTRANSFERS TOSTATE ,2501millionRM280,2502millionDEVELOPMENT EXPENDITUREOPERATINGEXPENDITURES ource: Ministry of Finance, AND USEOF GOVERNMENT'S Title Page 910/28/17 8:44 PMWJD009870 Title Page 1010/28/17 8:44 PMBUDGET 20181 THE 2018 BUDGET SPEECHByYAB DATO SRI MOHD NAJIB TUN HAJI ABDUL RAZAKPRIME MINISTER AND MINISTER OF FINANCEINTRODUCING THE SUPPLY BILL (2018)IN DEWAN RAKYATFRIDAY, 27 OCTOBER 2017 PROSPERING AN INCLUSIVE ECONOMY,BALANCING BETWEEN WORLDLY AND HEREAFTER,FOR THE WELLBEING OF THE RAKYAT,TOWARDS THE TN50 ASPIRATION Mr Speaker Sir,I beg to move the Bill intituled An Act to apply a sum from the Consolidated Fund for the service of the year 2018 and to appropriate that sum for the service of that year be read a second Teks 1 110/28/17 8:45 PM2 BUDGET 2018 INTRODUCTION1.

7 There is no God but Allah, and Muhammad is the messenger of Allah. Send your blessings to our Prophet Muhammad SAW, and salute him with all Greetings, Salam Negaraku and Salam 1 Malaysia to Mr Speaker Sir, Members of Parliament, Ladies and Gentlemen and all Malaysians from Northern Perlis to Tanjung Piai in the South as well as Sabah and Sarawak. 3. Many may have predicted that the 2017 BUDGET was an Election BUDGET . 4. This is expected as there were many initiatives and allocations announced for the rakyat and in the interest of the nation. However, their predictions were Last week, our Indian friends celebrated the Festival of Lights or Deepavali. We wish Happy Deepavali to all.

8 As Friday is an important day for Muslims, let s celebrate together. 6. As such, I would call upon the rakyat to rejoice in receiving the gifts, rewards and incentives, which will be presented in this BUDGET , subject to a condition. And the condition is that you follow through this presentation from the beginning to the end. 7. I am standing here, on this day, 27 October 2017 or 7 Safar 1439 Hijri, to bring good and happy news, which will put smiles on every This good news is for all beloved Malaysians to enjoy, regardless of race and background. 9. It is clear that every segment of society will reap the benefits from this Hence, on behalf of the Government, let us first immerse and analyse on what I am about to present.

9 Otherwise, you will miss the good Teks 1 210/28/17 8:45 PMBUDGET 2018311. In building a civilised nation, we should always be gracious. Let s forgive and forget. ECONOMIC PERFORMANCE AND CHALLENGES12. First, let us be grateful to Allah SWT for the continued positive expansion of our economy. 13. During the first half of 2017, the economy recorded a sterling growth of Therefore, we should not fall for lies and non-stop propaganda on social media by irresponsible parties, stating that the World Bank has issued negative reports on the nation s economy. 15. In fact, the World Bank has revised their forecasts on the East Asia and Pacific region. 16. The World Bank has revised upwards Malaysia s GDP forecast from to for 2017 and commended the country s economic performance for its laudable policies.

10 17. In addition, the Government forecasts the Malaysian economy to record an annual growth of between and in 2017, higher than the March estimates ranging between and For the past eight years, amid economic challenges, Malaysia has made significant development in two important aspects:First: Strengthening and deepening diplomatic and trade relations with the world s largest economic powers such as China, India, Saudi Arabia and the United States. Furthermore, private investment has increased significantly to more than RM211 billion compared with RM81 billion in 2009. WJD009870 Teks 1 310/28/17 8:45 PM4 BUDGET 2018 Second: Since 2009, the country has been facing various external challenges such as plummeting global crude oil prices and international geopolitical tensions.