KUALA LUMPUR, Oct 29 (Reuters) - Malaysia announced an expanded budget on Friday aimed at jump-starting its pandemic-battered economy in 2022, according to the government’s fiscal and economic outlook reports laying out the budgetary details. Fresh COVID-19 lockdowns have dampened recovery, with the Southeast Asian country slashing here its 2021 growth outlook twice to 3%-4% this year, but a ramped-up vaccination drive and gradual reopening have boosted hopes of a quick turnaround. The budget is also expected to set the stage for a general election that could be called by in the middle of next year. Malaysia’s next polls are due by 2023. The government plans to spend 332.1 billion ringgit ($80.06 billion) in 2022, up from 320.6 billion ringgit this year, despite lower-than-expected revenue and a widening deficit in 2021, one of the reports said. “In the past 19 months or so, the government has repeatedly proven that despite our tight fiscal space, we delivered as best as we could,” Prime Minister Ismail Sabri Yaakob said in his foreword to the government’s 2022 fiscal outlook report released ahead of the budget. “However, when it comes to strengthening our fiscal position, ultimately it depends on a sustained economic recovery.” Malaysia has rolled out 530 billion ringgit worth of stimulus packages to soften the pandemic’s blow, as coronavirus curbs weighed on revenue - targeted to come in at 221 billion ringgit this year, 6.7% short of initial estimates. But it expects economic growth to accelerate to between 5.5%-6.5% next year, driven by further reopening of the economy and improved external demand, the report showed. Its fiscal deficit is also expected to moderate to 6% in 2022, after climbing to 6.5% this year. Next year’s spending increase includes a hefty 21.9% jump in development expenditure, to 75.6 billion ringgit, while operating expenses will rise 6.3% to 233.5 billion ringgit. Revenue is seen expanding 5.9% to 234 billion ringgit in 2022, including 25 billion ringgit in dividends from state energy firm Petronas, unchanged from the 2021 dividends. $1 = 4.1480 ringgit Reporting by Rozanna Latiff; Editing by Simon Cameron-Moore
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