Malaysia to hike civil servant salaries by 13%

Malaysia Prime Minister announced a salary increase of over 13 per cent for civil servants, effective December 2024, aiming to bolster living standards amidst rising prices and a weakening currency, as reported by Reuters on Wednesday.

The salary increase, which will require an allocation of 10 billion ringgit ($2.10 billion), aims to bolster the purchasing power of civil servants.

Additionally, the government is finalising plans to ensure a minimum monthly income exceeding 2,000 ringgits for all government employees.

Malaysia’s government and central bank remain optimistic about economic growth, projecting a range of 4 to 5 per cent for the full year.

This represents an improvement from 2023’s 3.7 per cent growth which fell significantly from the 22-year high of 8.7 per cent recorded in 2022.

The ringgit’s performance has been a concern, weakening 3.9 per cent against the US dollar so far in 2024. In February, it even reached a 26-year low.

While attributing the decline primarily to external factors, both the government and central bank anticipate the currency to strengthen by year’s end.