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KUCHING: The RM16.2-billion federal allocation for Sarawak under Budget 2027 is expected to unlock economic opportunities through infrastructure development, improved connectivity and investment across key industries, says AFFIN Group’s President and Group Chief Executive Officer, Datuk Wan Razly Abdullah.
He said the continued focus on Sabah and Sarawak was encouraging, as sustained investment in infrastructure and regional development could support more balanced economic growth nationwide.
“For AFFIN, this aligns well with our strong franchise in East Malaysia, where projects such as the Pan Borneo Highway Sabah, the Sarawak-Sabah Link Road and new gas developments are expected to generate financing opportunities across the infrastructure value chain,” he said in a statement on Budget 2027.
Wan Razly said the budget came at a pivotal time as Malaysia navigated shifting geopolitical dynamics, evolving global trade patterns and persistent cost pressures.
He said the budget, with total spending and investment of RM510 billion, reflected the government’s commitment to supporting economic growth, easing the cost of living and maintaining fiscal discipline.
He welcomed the government’s fiscal consolidation efforts, with the fiscal deficit projected to narrow from 3.7 per cent of gross domestic product (GDP) in 2025 to 3.6 per cent in 2026, before reaching 3.3 per cent in 2027.
“Efforts to enhance revenue collection and manage public expenditure prudently remain important, alongside the flexibility to pursue development projects and strategic investments that support sustainable, long-term economic growth,” he said.
With Malaysia’s economy projected to grow between 4.2 and 5.2 per cent in 2027, he said the shift towards higher-value industries, technological innovation and deeper regional integration presented opportunities to strengthen productivity and competitiveness.
Wan Razly also welcomed measures to ease household financial pressures, including the increase in allocations for Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) to RM16 billion in 2027, as well as greater tax relief for middle-income households.
He said the initiatives were expected to support household spending, increase disposable income and sustain domestic economic activity.
On homeownership, he said the RM20-billion housing financing guarantee under Syarikat Jaminan Kredit Perumahan (SJKP), which is expected to benefit 80,000 first-time homebuyers, was a positive step towards widening access to housing finance.
“AFFIN remains supportive of initiatives that broaden financing accessibility and is dedicated to helping more Malaysians realise their homeownership aspirations through accessible and tailored financing solutions that cater to diverse income profiles and evolving customer needs,” he said.
Wan Razly said micro, small and medium enterprises (MSMEs), which contributed 39.7 per cent of Malaysia’s GDP in 2025 and accounted for 48.7 per cent of total employment, remained pivotal to the country’s economic transformation.
He said the proposed one-percentage-point reduction in MSME income tax rates, expected to benefit about 300,000 businesses, alongside the expansion of loan and financing guarantee facilities to RM57 billion in 2027, would provide businesses with greater financial flexibility.
The RM3.5-billion allocation for trade and industry, including programmes for small and medium enterprises, was also expected to support investment, productivity and long-term competitiveness.
Beyond conventional lending, he said a more diversified capital ecosystem, including private equity and other forms of growth capital, could complement banking solutions for businesses seeking to expand, innovate and pursue regional opportunities.
He cited AFFIN’s recent USD400 million financing collaboration with the International Finance Corporation as part of the group’s efforts to broaden access to financing for eligible MSMEs, including women-owned businesses and enterprises in underserved regions.
Wan Razly also highlighted opportunities arising from the proposed introduction of tokenised retail savings sukuk, which he said could broaden access to investment and reinforce Malaysia’s position in Islamic finance.
He said the development could create opportunities for AFFIN Islamic to support demand for sukuk and shariah-compliant financing, particularly in high-growth sectors such as energy, utilities and data centres.
On tourism, he said the extension of Visit Malaysia to 2027, the RM935-million allocation for tourism and culture, major events such as the SEA Games and LIMA, and improved connectivity through the East Coast Rail Link and Johor Bahru-Singapore Rapid Transit System Link, were expected to stimulate local economic activity.
He said businesses in hospitality, retail and tourism-related services, including those in Sarawak and Sabah, could benefit from these developments through improved access to financing and digital payment solutions.
“Looking ahead, we believe Budget 2027 presents a meaningful economic outcome, from improving household financial well-being and supporting homeownership to enabling businesses to grow and participate in emerging economic opportunities,” he said.
Wan Razly said AFFIN would continue to focus on delivering relevant financial solutions, supporting businesses and helping more Malaysians participate in the country’s economic progress.
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