Penang’s GDP rose 7.3% in 2025—what drove it?

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Manufacturing and Services Sectors Drove Penang's 7.3% Economic Growth in 2025

Penang's economy experienced a robust 7.3% expansion in 2025, with its Gross Domestic Product (GDP) reaching RM130.3 billion. This significant growth was primarily propelled by the manufacturing and services sectors, which collectively accounted for 94% of the state's economic output. The manufacturing sector, in particular, demonstrated strong performance, contributing 47.3% to the state's GDP.
Manufacturing Sector's Dominant Contribution

The manufacturing sector was the leading force behind Penang's economic surge in 2025, contributing RM61.7 billion to the state's GDP and exhibiting a substantial 10% growth. This performance was largely driven by the electrical, electronic, and optical products segment, which saw an impressive 12.7% increase. Furthermore, the non-metallic mineral products, basic metal, and fabricated metal products subsectors also provided crucial support, growing by 8.7% and bolstering the overall manufacturing output.
Services Sector's Steady Expansion

Complementing the manufacturing sector, the services sector recorded a value added of RM60.8 billion, marking a 4.1% growth. The wholesale and retail trade, food and beverage, and accommodation subsector were key contributors to this expansion, with a notable 5.6% increase. Additionally, the utilities, transportation and storage, and ICT subsector contributed to the services sector's positive trajectory, expanding by 2.7%.
Construction Sector's Accelerated Growth

The construction sector also played a significant role in Penang's economic uplift, expanding by a remarkable 13.4% and generating RM4.3 billion in value added. This surge was propelled by strong performance within the civil engineering and special trade subsectors, indicating a dynamic activity within the state's development landscape.
Agriculture and Mining Sectors Show Modest Gains

While not as dominant as manufacturing or services, the agriculture sector contributed to the overall growth with a 1.8% increase, aided by a 3.4% rise in the fisheries subsector. The mining and quarrying sector also registered a modest growth of 1.1%, reflecting a broad-based, albeit varied, economic expansion across different industries within Penang in 2025.

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Penang’s GDP rose 7.3% in 2025—what drove it?

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