Malaysia Belanjawan 2025: Key Investments in Built Environment

Belanjawan 2025 is known as a pragmatic focus on sustainable growth and inclusive development in Malaysia’s built environment.

The recent Malaysia Belanjawan 2025 unveils a pragmatic budget for built environment key investments that prioritise inclusivity, infrastructure improvements, and sustainable growth over high-profile mega-projects.

This budget represents a clear shift in the government’s approach to development, aligning fiscal priorities with social well-being, job creation, and corruption reduction, as emphasised by Malaysia’s Prime Minister. He stated that “This Belanjawan strives to put the house in order” by addressing infrastructure needs, safeguarding the vulnerable, and tackling inefficiencies like corruption and resource leakages.

Unlike past budgets centred on mega-projects that burdened the national debt while delivering limited economic benefits, Belanjawan 2025 focuses on enhancing the living standards for all Malaysians by delivering quality infrastructure, job opportunities, and social protections. Let’s break down the key highlights across sectors in this year’s budget for Malaysian Built Environment.

Key Investment for Built Environment

Education and Public Housing: Foundations for Sustainable Growth

The Belanjawan 2025 budget prioritises education infrastructure, acknowledging the need to improve school facilities across Malaysia, particularly in underdeveloped regions. The government has allocated RM2 billion for the upgrade and maintenance of schools in rural areas, with a main focus on Sabah and Sarawak.

This move not only addresses long-standing infrastructure gaps in these areas but also aligns with the government’s emphasis on equitable development, aiming to create conducive environments for students nationwide.

The government/Ministry of Housing and Local Government dedicates nearly RM900 million to the Program Perumahan Rakyat (PPR) and Rumah Mesra Rakyat in public housing.

These allocations demonstrate a commitment to affordable housing, especially for low-income families, by providing sustainable and well-maintained living conditions. Ensuring that Malaysians have access to affordable housing is a key element in raising living standards and enhancing social protections.

Healthcare Infrastructure: Expanding Access and Quality

To address healthcare needs in underserved areas, the budget introduces several new projects aimed at expanding healthcare facilities. The government/Ministry of Health will develop Hospital Sultanah Aminah 2 in Johor through a Public-Private Partnership (PPP), while also allocating a significant RM1 billion to the Sarawak Cancer Centre to improve cancer care services in East Malaysia. Additionally, Hospital Kulim in Kedah will see new blocks constructed to expand its capacity.

These healthcare investments aim to reduce regional disparities in access to quality medical care, highlighting the government’s focus on targeted infrastructure that directly benefits the rakyat as opposed to costly and centralised mega-projects.

Flood Mitigation and Disaster Management: Enhancing Resilience

A key area of investment in Belanjawan 2025 is flood mitigation and disaster management, with RM600 million allocated for projects aimed at addressing flood-prone areas across states such as Selangor, Sabah, Pahang, and Terengganu. The government will use an additional RM150 million for cleaning drains and dredging rivers to combat urban flash floods and over RM250 million for slope stabilisation projects to mitigate landslides.

These projects are essential for enhancing Malaysia’s resilience to natural disasters and extreme weather events, which have become increasingly common due to climate change. By investing in localised infrastructure, the government seeks to protect communities and reduce the social and economic toll of frequent flooding, especially on vulnerable populations.

Transportation and Roads: Expanding Accessibility and Reducing Congestion

A significant portion of the budget is directed toward expanding and upgrading key transportation and road networks, particularly in underserved regions. For example, the North-South Expressway will be widened from four to six lanes along the Simpang Renggam-Machap stretch in Johor. In addition, the budget includes funding for Penang LRT and Penang International Airport expansion projects, as well as the Cameron Highlands Bypass in Pahang to alleviate traffic congestion.

In Selangor, the expansion of Port Klang and Westports 2 aims to bolster Malaysia’s position as a major global logistics hub. These transportation infrastructure projects underscore the government’s commitment to regional connectivity, which is critical for economic growth, especially in states like Johor and Penang and Selangor.

Conservation and Heritage Restoration: Preserving Malaysia’s Cultural Identity

The budget acknowledges the importance of Malaysia’s cultural heritage by allocating funds for the restoration and revitalisation of historical landmarks in Kuala Lumpur. Specifically, the Sultan Abdul Samad Building, Kuala Lumpur Railway Station, and Carcosa Seri Negara will undergo conservation work managed by Khazanah Nasional, a government-linked investment company.

This move aligns with the government’s broader objective of promoting sustainable heritage conservation and adapting historical sites for contemporary use, enhancing their value as cultural and tourism assets while preserving Malaysia’s identity.

Green and Renewable Energy: Building a Sustainable Future

Belanjawan 2025 emphasises green energy and sustainable practices, with several initiatives aimed at promoting renewable energy sources. The Large-Scale Solar (LSS) Programme, which includes the development of a 2,000 MW solar power plant, marks a significant step towards a greener energy grid. Additionally, a 5 kilometre solar-powered walkway will be constructed in Putrajaya, and hybrid solar projects in Terengganu, such as the Kenyir Hybrid Hydro-Floating Solar Farm and a green hydrogen hub, are part of the plan.

These investments reflect Malaysia’s commitment to the National Energy Transition Roadmap (NETR), promoting clean energy sources and reducing the nation’s reliance on fossil fuels. Notably, the budget includes investment tax allowances and income tax exemptions for companies engaged in carbon capture and green energy projects, encouraging private sector participation in Malaysia’s transition to a low-carbon economy.

Public and Private Investment: A New Paradigm in Development Financing

While mega-projects have traditionally been a hallmark of Malaysian built environment development, this budget marks a significant pivot toward a development-focused investment strategy with a combination of public and private funding. The government has announced RM120 billion in total public investment for development in 2025, with RM9 billion earmarked for Public-Private Finance Initiative (PFI) projects and RM25 billion in domestic investments from Government-Linked Investment Companies (GLICs).

This shift aims to enhance private-sector involvement in infrastructure development, fostering job creation and regional economic growth. The New Investment Incentive Framework, which focuses on high-value activities, underscores Malaysia’s goal of attracting meaningful investments that bring value to the rakyat through quality job creation in sectors such as artificial intelligence, integrated circuits, and data science.

The Vision for Inclusive and Sustainable Development

In summary, Belanjawan 2025 takes a strategic approach to rebuilding Malaysia’s built environment and addressing structural challenges. The Prime Minister’s vision is clear: to move away from debt-burdening mega-projects and focus on development that directly benefits the rakyat, uplifts living standards, and prioritises the country’s long-term economic resilience.

By implementing high-impact infrastructure projects that enhance regional connectivity, protect against natural disasters, and encourage sustainable energy, the government has laid a foundation for growth that includes all Malaysians. This budget represents not only a financial plan but a call to action for Malaysia, where public investments serve as catalysts for economic and social equity. Belanjawan 2025 emphasises a collective effort to ensure a resilient, prosperous future for every Malaysian, fulfilling the government’s promise to raise the floor and uplift the nation as a whole.