KUALA LUMPUR (Dec 18): The World Bank has once again lowered its gross domestic product (GDP) growth expectation for Malaysia this year to 4.7% from a 4.9% prediction set in early October 2018.

This is due to two factors, namely lower government spending and a decline in private and public investment, said Shakira Teh Sharifuddin, country economist for Malaysia at the World Bank.

In addition to moderating growth, risks are increasingly skewed towards the downside, noted Mara Warwick, World Bank country director for Brunei, Malaysia, Philippines and Thailand, at the launch of Dec 2018 Malaysian Economic Monitor today.

A key concern domestically is the narrow fiscal space the government has, to cope with shocks, especially due to steeply declining revenue and high level of public debt, she noted.

"It is important that efforts to sustain growth in the near term are carefully balanced with the need to restore fiscal buffers," Warwick said.

That being said, even in the face of a potential recession in developed nations next year, Malaysia's economy is expected to remain resilient with the World Bank maintaining its 4.7% GDP growth forecast for 2019.

On Oct 5, 2018, the World Bank cut its GDP growth forecast from a 5.4% forecast made in April, due to the cancellation of several infrastructure projects as well as a lower export growth outlook.