KUALA LUMPUR, Jan. 25 (Xinhua) -- Moody's Ratings has affirmed Malaysia's local and foreign currency long-term issuer and local currency senior unsecured debt ratings at A3 with a stable outlook.

The rating agency said on Friday in a statement that the rating affirmation and stable outlook reflect its expectation that Malaysia's medium-term growth prospects will remain strong, while its credible and effective macroeconomic policymaking institutions continue to provide resilience to the sovereign credit profile.

"Notwithstanding progress on fiscal consolidation as it has emerged from the pandemic, Malaysia's credit strengths are primarily balanced against a relatively elevated government debt burden and weak debt affordability," it said.

Moody's also projected Malaysia to be the fastest-growing A-rated economy over the next two years.

This reflects sustained structural credit strengths such as its well-diversified economic structure and competitiveness, as well as broad price stability that underpins healthy consumption, it noted.

Moreover, it said Malaysia has been a clear beneficiary of associated flows of foreign direct investment (FDI), which has catalyzed gross fixed capital formation, particularly in sectors such as semiconductor manufacturing and data centers that build upon its advantages in human capital, plentiful land and affordable energy as compared to its emerging market peers.

Malaysia's recent ability to attract large amounts of FDI is augmented by the formulation of longer-term initiatives to address longer-term challenges to development, it added. Enditem

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