Budget 2026: How Government Handouts and Green Spending Could Shape Your Portfolio
The tabling of Malaysia’s Budget 2026 last Friday brought a mix of optimism and curiosity among Malaysians. While the government continues to keep a close eye on fiscal discipline, it has also introduced fresh support to help ease living costs and stimulate growth in targeted areas of the economy.
With a total allocation of RM419 billion, including RM81 billion in development expenditure, Budget 2026 is designed to sustain Malaysia’s recovery momentum while encouraging new investment in green and high-impact sectors. When factoring in additional contributions from GLCs, GLICs, and public-private partnerships, total spending could reach RM470 billion, the largest in the country’s history.
For most of us, the budget offers some welcome relief. The RM100 Sumbangan Asas Rahmah (SARA) cash handout is back, benefiting 22 million Malaysians aged 18 and above. Tax reliefs for healthcare, insurance, and childcare have been extended, and there’s renewed support for first-time home buyers, vehicle replacement incentives, and green tech rebates. These measures are expected to keep consumer spending steady and improve sentiment heading into 2026.
Opportunities Beneath the Surface
Rakuten Trade’s research team sees Budget 2026 as a continuation of last year’s pro-growth stance. While there were no flashy mega projects announced, there’s still plenty of room for investors to find value, especially in the consumer, construction and renewable energy sectors.
“Budget 2026 builds on last year’s direction, focusing on sustainable and inclusive growth. The lack of mega projects might seem conservative, but the allocations for infrastructure upgrades and renewable energy are encouraging,” said Kenny Yee, Head of Research at Rakuten Trade.
Where the Momentum Is
- Consumer Sector: Everyday Spending, Everyday Gains
With cash handouts and tax reliefs in play, value-focused retailers like MR D.I.Y., AEON, and 99Speedmart could benefit from stronger domestic consumption. These companies offer steady exposure to everyday spending; ideal for investors looking for resilience in uncertain markets.
- Construction Sector: Building from the Ground Up
Even without headline-grabbing projects, the RM81 billion development budget includes funding for flood mitigation, water management, and smaller-scale infrastructure works. Companies like Gamuda, IJM Corp, and Cahya Mata Sarawak are well-positioned, especially with RM12.9 billion earmarked for Sabah and Sarawak.
- Renewable Energy: Powering the Transition
Green growth remains a priority. With RM16.5 billion in investments from GLCs and GLICs, expect momentum in solar power, EV infrastructure, and sustainable energy systems. Key players like Tenaga Nasional, Samaiden, and Solarvest stand to benefit from both policy support and Malaysia's energy transition roadmap.
What You Can Do Next
Budget 2026 may not be flashy, but it’s clear about where growth is headed. For investors, the strategy is simple: follow the fiscal signals and back companies that can turn policy into profit.
Here’s how Rakuten Trade can help:
- Stay Informed: Tap into exclusive insights via your dashboard or RakuInsights webinars.
- Act Fast: Use Rakuten Trade’s low brokerage to move quickly as sector trends emerge.
- Diversify Smartly: Balance your portfolio across consumer staples, infrastructure and green energy.
- Earn Rewards: Trade, refer friends or transfer your Bursa shares to earn RT Points and share rewards.
Bottom Line
Budget 2026 reinforces stability, inclusivity, and gradual reform and for investors, that means opportunity in the right places. The consumer, construction, and renewable energy sectors are poised to lead in 2026, supported by both government policy and corporate expansion.
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