Malaysia will survive GE13, says ‘Dr Doom’

By ZURAIRI AR | MARCH 01, 2013
The Malaysian Insider

KUALA LUMPUR, March 1 — The Malaysian economy will weather the next general election and stay robust even with a change in government, renowned world economist Nouriel Roubini said today.

Roubini, also known in the media as “Dr Doom” for his consistently pessimistic economic outlook, gave his prediction today amid previous warnings by names such as veteran statesman Tun Dr Mahathir Mohamad and former top cop Tan Sri Musa Hassan that Malaysia will descend into political and economic chaos should Pakatan Rakyat (PR) wins the next polls.

“I would say whatever the result is going to be, this country has shown institutional and political stability,” Roubini said here in his keynote address at the Datum Economic Forum 2013.

“Investors recognised that, and therefore as long as there is a democratic process, as long as there’ll be policy clarity after those elections, it’s certainly going to be positive.”

Roubini admitted that the electoral process itself will introduce elements of uncertainty for investors, but refused to comment on the election date that has yet to be announced.

“I think whether the decision will be taken imminently or shortly … whatever those results may be, this is a stable democracy that’s been committed to following economical policies to economic success

“It’s going to be positive,” he added.

Roubini also offered his observation on pre-election practices which are affecting Malaysia’s economic standing.

Tan Sri Khalid Ibrahim (centre) officiates the Datum Economic Forum 2013 “Building Communities Enriching Lives” in Kuala Lumpur March 1, 2013. — Picture by Choo Choy May
“Whenever there’s an election, whoever’s in power before elections provides cash handouts to the people as a way of boosting chances of winning, and that increases a chance of deficit in an election year,” Roubini said.

“Hopefully that will be reversed after the election.”

Roubini, who was named as Top 100 Global Thinkers by Foreign Policy magazine, gained popularity after he predicted the United States sub-prime crisis and the subsequent worldwide recession in 2008 three years before it happened.

On January 2011, Roubini’s analysis firm Roubini Global Economics (RGE) commented that much-needed reforms to Malaysia’s pro-Bumiputera policies would likely be put on the back burner until Prime Minister Datuk Seri Najib Razak secures a new electoral mandate.

In the report titled “Wednesday Note — Malaysia’s Middle-Income Malaise” RGE reported that Umno was “unlikely” to revamp such policies “blocking” Malaysia’s rise to high-income nation status before the next general election for fear of antagonising Malay voters.

It also said that affirmative action policies have exacerbated the non-Bumiputera brain drain problem and also created a “strategic disadvantage” for local firms by limiting human and financial capital as well as “perpetuating an unlevel playing field” for entrepreneurs.

Roubini, an economics professor at New York University’s Stern School of Business, previously advised the World Bank and International Monetary Fund (IMF) and currently holds research fellowships at London’s Centre for Economic Policy Research (CEPR) and the National Bureau of Economic Research (NBER) in Cambridge, Massachusetts.

  1. #1 by Loh on Friday, 1 March 2013 - 11:11 pm

    ///Tuition fees can be as low as RM2,000 to RM3,000 a year for public universities, RM30,000 to RM40,000 (non-medical courses) for private universities.

    If they go to a government university, 90 per cent of the expenses have already been absorbed by the government (from taxpayers’ pockets to be exact). The remaining 10 per cent can be settled with PTPTN loans (which many use to acquire the latest smartphones).

    With populism raging across the country’s political front, some call for free tertiary education: RM700 million to first get public universities free, and then an astronomical RM43 billion to render the PTPTN irrelevant.///–Tay Tian Yan,

    The RM 43 billion in PTPTN has mostly been incurred by students sent overseas by BN government, which got the students incurred huge debt in the first place. It costs a student 30,000 pounds a year studying in the United Kingdom. A three year first degree course has a student owe PTPTN 90,000 pounds or RM 450,000. A fresh graduate earns RM 2,800 a month. It will take the student 160 months to earn RM 450,000 RM. If he allots 10% of his income to repay the loan, interest free, he will take 133 years. No student can ever repay the loan, unless he became UMNOputras, in which case, he needs not pay.

    The students were sent overseas by the government which gave the students false hope that they could repay the loan. The government might have indeed not thought through the consequence, thinking first of all that overseas scholarship to Malay students would encourage other Malays in the area to vote for BN. They might not have wanted the loan back, as many have defaulted with impunity. Some first class degree holders have their loans converted to scholarships, as it should be to reward hard work.

    The government sent tens of thousands of students overseas on PTPTN, mainly from one race, to pursue undergraduate studies. This should stop. Even for scholarship holders, they should be limited to perhaps a fraction of what are sent now, say 500 of exceptional talents, a year. Other excellent students should remain in the country to help make local universities raise their standards with their questions and discussions among fellow students.

    Since most of the loan under PTPTN cannot be recovered anyway, it might be better to spare those who conscientiously making repayment at pains of starving, for having been misled on the garden path by BN government. If Pakatan Rakyat government cannot pursue the return of money lost through corruption, it makes sense to forgive those who are honest in making repayment, and spare them the agony of not following the defaulters.

    It is certainly hoped that people who had been misled to take the PTPTN would support Pakatan Rakyat to form the next government, and to support its proposal to end NEP, and hence unfair practice of racial discrimination.

    Malaysia needs a new start. Ending PTPTN when it is clear that the scheme had been mismanaged and loan repayment was not possible is the right decision.

    ///Considering the rational distribution of resources, do we really need to exempt the 10 per cent tuition fees already at super low interest rates, now that 90 per cent have been subsidised in the case of public universities?///–the author

    Since the tuition fees account for only 10% of the cost of education, it should not be a huge burden when loans are offered on tuition fees. However having forgiven the bulk of PTPTN loans, the scheme should stop. Some students might still face difficulties to raise the tuition fees. It should thus be better to waive the tuition fees of RM 700 million which is less that BR1M.

    Over the years BN government has discriminately encouraged unsuitable students for university education resulting in a large number of unemployable graduates. That is bad for the morale of the graduates, a pain for the families and a burden for the government to absolve them into the bloated government service. Pakatan Rakyat government should stream those who are less inclined academically for vocation training to spare them the pain of the stigma of unemployables. They should be able to excel in the career suitable to their aptitude.

    ///Will such fully paid for, zero input, absolutely burden-free offerings help our students learn to stand on their own feet and instil in them a deep sense of responsibility?///–the author

    They should be taught that one harvests what he sows, and to think what they can repay the society for what the society had helped them. If they acquire the thought that they have to be responsible for their life, and not ask only what the government can do for them, the society will benefit.

    ///From the fairness point of view, given such a disparity between the tuition fees of public and private universities, many families, including the majority of non-Bumiputera families, have to work extra hard to pay their children’s tuition fees in private universities while also paying taxes to justify free government education for other people’s children.

    Do you call that fair?///–the author

    The system has been most unfair, especially after the advent of NEP. In pre-NEP days, Malays were accepted into the only university, Malaya University, as long as they met the minimum entry qualifications, but they met the same standards of examination markings on leaving. There was no quota.

    NEP changed all that. It is hoped that Pakatan Rakyat would pursue the pre-NEP policies on education. There will be huge savings in foreign exchange if non-Malays can pursue their first choice of first degree in the country.

    When UMNO politicians claim that students from young should study under one roof, ignoring the right of citizens to retain their culture and language, they choose to make university education segregated. UiTM has a student population of 170,000; all of them Malays. Other 10 government universities have a combined student enrolment of 170,000 too, 60 per cent are Malays. Worse non-Malays are discouraged to enrol in the course of their choice. A study on government universities shows that more than 95% of the students of any one race do not associate or interact with students of other races. Non-Malay students know their grievances, and most Malay students are sheepish that the UMNO government is racist.

    Pakatan Rakyat would be another BN if it pursues the same race-based policies.

  2. #2 by yhsiew on Saturday, 2 March 2013 - 3:34 am

    “Dr Doom” failed to predict whether Malaysia will survive BETTER under a PR-led government or a BN government.

  3. #3 by Winston on Saturday, 2 March 2013 - 9:23 am

    Malaysia will survive GE13, says ‘Dr Doom’ – End of quote

    The response to that statement is, “Yes, if GE13 is won by the PR; No, if it’s won by the UMNO/BN crooks!
    If the good governance practised by the PR in the four states is anything to go by, things will definitely improve.
    Without the shackles of corruption, scams and scandals, why shouldn’t they be?
    But with UMNO/BN back in the saddle, it will be the same old, same old.
    Or ever far worse!!
    Because, now, at least according to them, the electorate have given them further licence to continue their corruption, scams and scandals!
    So, which party will one vote for?
    The answer is a no-brainer!!!!

  4. #4 by monsterball on Saturday, 2 March 2013 - 9:35 am

    “Dr. Doom” prediction on 13th GE….is nothing but a 50/50 chance ruse…applied.

  5. #5 by lee tai king (previously dagen) on Saturday, 2 March 2013 - 10:29 am

    ///If he allots 10% of his income to repay the loan, interest free, he will take 133 years. No student can ever repay the loan, unless he became UMNOputras, in which case, he needs not pay./// per Loh.

    Ho Ho Ho Ho. This must definitely be statement of the month!

    Good one, Loh.

  6. #6 by lee tai king (previously dagen) on Saturday, 2 March 2013 - 10:36 am

    Yeah. LISTEN here you dr doooooom. Tell me. Tell me what do you know about Prinsip2 Ekonomi Pokok Rambutan by the world famous cintanegara.

    Do you know that cintanegara’s rambutan fruit can grow right out of the soil without any need for branches and leaves etc.? And yeah, one more thing. Do you know that according to cintanegara’s prinsip2, umno’s economic pie can grow itself without any need for input by any one?

  7. #7 by chengho on Sunday, 3 March 2013 - 8:16 am

    when all the fundamental strong , you can survive any weather , you should thanks Tun M

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