(MENAFN) Analysts say Malaysia’s 470-billion-ringgit (111-billion-U.S.-dollar) Budget for 2026 is expected to boost several key sectors, including technology, consumer goods, construction, and renewable energy.

Kenanga Research highlighted that the budget represents a comprehensive push for artificial intelligence (AI), complementing the country’s upstream technology initiatives.

"Even so, one positive surprise in terms of commitment shown is in holistically developing the ecosystem, especially in government and industry adoption of AI, which is a game changer.

This includes setting aside cross-ministerial allocations, and implementing a National Action Plan 2030," the research house said.

Meanwhile, Maybank Investment Bank noted that higher government stimulus payments planned for 2026, combined with a 7 percent civil service salary adjustment starting Jan. 1 and the completion of subsidy rationalization for items such as chicken, eggs, and petrol, should ease household financial pressures amid rising costs and inflation.

CIMB Securities called the budget expansionary for Malaysian contractors, pointing out that while headline development expenditure is projected to rise only slightly to 81 billion ringgit (+1.3 percent year-on-year), total public investments could reach 131 billion ringgit thanks to an additional 50.8 billion ringgit injected by federal agencies and government-linked companies.

Philip Capital also highlighted the government’s continued commitment to regional energy connectivity, with projects including the ASEAN Power Grid and the Vietnam-Malaysia-Singapore renewable energy initiative. The 43-billion-ringgit investment by Malaysian utility Tenaga Nasional Berhad (TNB) to upgrade the national power grid is expected to produce significant positive spillover effects across the domestic supply chain.

MENAFN14102025000045017640ID1110194257