KUCHING: The state economy is projected to grow at 5.0 per cent this year in tandem with the expected robust domestic and external demand arising from a more positive growth in global economy.

Second Minister of Finance Dato Sri Wong Soon Koh said in his winding-up speech at the DUN sitting yesterday that all sectors are expected to expand positively, with manufacturing, services and construction to remain as the key drivers of growth.

He said the services sector is projected to expand by 6.6 per cent from both domestic consumption and investment activities.

With the ‘Visit Sarawak 2014’ campaign, tourism-related services sub-sector is anticipated to gain from tourist arrivals, said Wong.

The manufacturing sector is expected to grow at 5.0 per cent, led by improved external demand for resource-based sub-sectors in tandem with the gradual recovery in the global economy.

As for construction sector, it is projected to continue with a firm expansion at 10.5 per cent consonant with rapid infrastructure development in the state.

“The mining and quarrying sector in 2014 is expected to maintain its growth at 1.5 per cent with enhanced production of crude petroleum and natural gas from deep water and marginal fields.

“The agriculture sector is projected to grow by 4.8 per cent this year due to expected higher production of palm oil and other food crops in line with the government efforts to ensure food security,” Wong added.

On demand side, he said private consumption is expected to expand by 7.8 per cent, driven by favourable income prospects and improved labour market conditions.

Public consumption is projected to register a slower growth of 2.7 per cent, reflecting prudent spending by the government.

On investment, he said public investment is expected to register a growth of 4.5 per cent attributed by the implementation of various infrastructure projects, particularly in Sarawak Corridor of Renewable Energy (SCORE) and rural areas.

This year, private investment is expected to record a strong growth of 12.8 per cent supported by government initiatives to accelerate private sector participation towards sustainable growth in the state.

Capital spending in export-oriented industries is also expected to increase with gradual improvement in global economy.

On the inflation side, Wong said at the national level, inflation as measured by the consumer price index was modest at 2.1 per cent in 2013.

Inflation came mainly from food and non-alcoholic beverages, transport, housing, water, electricity and fuel.

These main items accounted for 87.0 per cent of the overall increase in consumer prices in 2013.

In Sarawak, inflation rate was 1.9 per cent in 2013, he said, adding higher prices were registered for food and non-alcoholic beverages accounting for 1.0 percentage point of the 1.9 per cent increase.

The inflation rate is expected to remain at a manageable level this year.

The anticipated upward price adjustment on prices of other goods and services due to subsidy rationalisation is expected to have a slight impact on inflation for the year.

On employment side, Wong said the labour market improved in 2013, reflected by low unemployment rate of 3.5 per cent.

Vacancies reported during the first nine months of 2013 stood at 29,087, an increase of two folds as compared to the same period in 2012.

The agriculture sector reported the highest number of job vacancies at 34.6 per cent of the total vacancies in 2013, followed by manufacturing sector at 28.7 per cent and construction sector at 18.5 per cent.