Early polls better for economy, says MIER

By Yow Hong Chieh
The Malaysian Insider
Jan 19, 2012

KUALA LUMPUR, Jan 19 — It would be better for the government to hold the general election as soon as possible since lingering uncertainty over the nation’s political future will hurt the economy, the Malaysian Institute of Economic Research (MIER) said today.

MIER executive director Dr Zakariah Abdul Rashid said private investors were currently holding back investments on concerns that government policies will change should the incumbent Barisan Nasional (BN) fail to hold on to power.

He said private investment was the key component to propping up the economy this year as external demand slows, and urged the government to call for early polls to dispel investors’ wait-and-see attitude.

“If you ask me as an economist, I would rather see the problem solved once and for all. The earlier they settle the political problem, the better, so we can focus on the economy.

“Right now everything is still hanging. People are postponing because of the election so if they settle it once and for all and immediately, it would be better,” he told reporters here after presenting MIER’s economic outlook for 2011 and 2012.

Business sentiment has steadily worsened from the second quarter of last year, according to the MIER’s Business Conditions Index (BCI).

The BCI score fell to 96.6 in the fourth quarter of 2011, the first time it has dipped below the 100 threshold since the fourth quarter of 2010.

Sales, new local and foreign orders as well as capacity utilisation were significantly lower in the fourth quarter of 2011, with companies expected to scale back production over the next three months as inventory builds up.

Consumer sentiment similarly fell to a two-year low of 106.3 on the Consumer Sentiments Index as household incomes lose momentum, and finances and job become a growing concern.

MIER expects GDP growth for the full year of 2011 to clock in at 4.9 per cent and only 3.7 per cent next year, pulled down by the euro zone crisis as well as cooling in China’s economy.

The World Bank warned yesterday that developing economies in Asia-Pacific, including Malaysia, will slow for a second straight year in 2012 as Europe’s debt woes and weaker global trade drag down growth prospects.

The US-based lender said in its Global Economic Prospects 2012 report that the health of Europe’s economy, bogged down by a sovereign debt crisis, represented the “strongest risk” for most of the countries in the region at this time.

It also noted that the economies of Malaysia, Indonesia, Thailand and the Philippines slowed sharply to 4.6 per cent in 2011 from 6.9 per cent in 2012, and predicted that growth in these countries would be mixed this year.

However, the World Bank said the expected strengthening in domestic demand in the ASEAN-4 countries would help offset the dampening effects of any decline in global trade.

  1. #1 by yhsiew on Friday, 20 January 2012 - 12:40 am

    The issue is with so many scandals besetting the BN government, does Najib have the guts to go for early polls?

  2. #2 by boh-liao on Friday, 20 January 2012 - 12:51 am

    WHAT MIER ED meant: “D earlier rakyat KICK UmnoB OUT, d BETTER”

  3. #3 by boh-liao on Friday, 20 January 2012 - 2:15 am

    $$$ makes more $$$!! D COW?itch (? = w or b, choose 1) so smart 1, now wants 2 collect additional RM100 million 4 herself n family by suing – no wonder mouth so BIG, jiak ka liao

  4. #4 by monsterball on Friday, 20 January 2012 - 5:49 am

    That was said months ago…but Najib dare not announce the date….because he knows UMNO b sure to be defeated.
    And so…$$$$ & SENSE means nothing to him.
    It’s SURVIVAL time…the longer …the better…like a man…holding onto a log of wood.. avoid drowning.
    Economy is so bad….go see all shopping complexes…empty…for shoes…clothes…computers.. and toy shops.
    Only food outlets have some customers.
    Now is the time for him to walk and met Malaysians…promoting his “1Malaysia” at Shopping complexes….if he dares.

  5. #5 by monsterball on Friday, 20 January 2012 - 6:00 am

    PR has appointed an independent Audit firm to declare their assets to the public…and Nazri said if UMNO b do the same..it will be dangerous for all of them…..hahahahahahahaha
    So much to hide…making nonsensical excuses.

  6. #6 by k1980 on Friday, 20 January 2012 - 7:36 am


    why we now have Ah Jib Gor in facebook in Mandarin. Dont be surprised that he will learn how to write a few chinese words and display his calligraphic skill in the coming Chinese New Year.

    He may of course play to the sentiments that many of the Chinese voters do not like the present No 2, so there may be a quiet campaign with his tacit blessing to tell the Chinese that if they do not vote BN, expect No 2 to take over in case BN wins but with a result worse than last time. This may actually motivate some of the lpeople in urban areas to vote for him.

  7. #7 by dagen on Friday, 20 January 2012 - 9:05 am


    Tell my why do umnoputras always tint their luxury car windows fully opaque.

    Tell me why do umnoputras who sell their luxury bungalows always do so in great haste and if possible they want cash payment to complete the sale immediately?

    I seem to hear a lot a lot more luxury bungalow sale by umnoputras lately. Is this a recent trend? If it is then what is driving that trend? Could it be that they are fearful of umno losing in GE13? If so then the ground under umno is certainly turning quite soggy and soft now.

  8. #8 by sotong on Friday, 20 January 2012 - 12:38 pm

    Oil reserve is the key to economic reform, being 40% of revenue.

    When it is depleted, there will be urgency to change to create real investment and jobs….but it is too late.

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