MALAYSIAN CENTRAL BANK SEES HIGHER 1987 GROWTH

  Gross domestic product (GDP)
  growth in 1987 is expected to grow by between 1.5 and two pct,
  up from one pct in 1986, the central bank said.
      The forecast compares with the one pct GDP growth forecast
  made by the Treasury last October.
      Bank Negara also said in its annual report that gross
  national product (GNP) is expected to grow by 3.5 to four pct,
  after declining 7.3 pct in 1986.
      It said that a turnaround in investor confidence since last
  November had been spurred by a moderate improvement in oil and
  commodity prices and a rise in manufacturing exports.
      Growth in 1987 is expected to come from the anticipated
  rise in export earnings if the industrialised countries sustain
  their average GNP growth at 2.5 to three pct, it added.
      Bank Negara said its forecast assumes that crude oil will
  average 15.50 dlrs a barrel, rubber at 210 cents a kilo, palm
  oil at 850 ringgit a tonne, tin at 17 ringgit a kilo and a rise
  of 12 pct in manufacturing exports.
      It said Malaysia's international terms of trade will turn
  around to rise by two pct in 1987 after declining 12 pct in
  1986 and five pct in 1985.
      "In 1987, income will be higher, private consumer spending
  is likely to recover and expand... The budget will remain under
  strict control... The resource gap in the government's finances
  on current account will be bridged over the near term," Bank
  Governor Jaafar Hussein said in the report.
      The current account deficit is expected to narrow to 1.19
  billion ringgit in 1986 or 1.8 pct of GNP from 1.79 billion or
  2.5 pct of the GNP the previous year.
      The bank forecasts the inflation rate will increase by 1.5
  pct, after its 0.7 pct rise in 1986.
  

