Archive for category Economics
What’s really choking investments in Malaysia?
by Edwin Yapp
The Malaysian Insider
Jul 21, 2011
JULY 21 — In my many years as a journalist, one of the most oft-asked questions I’ve put to interviewees who have business interests here in Malaysia is: “What are some of the factors that have prompted you to invest in Malaysia?”
The answers that I get, though not exactly the same every time, can be summarised into one or more of the following major points: low costs, multilingual workforce, skilled labour, and political stability. This was especially true in the heydays of the Multimedia Super Corridor (MSC) Malaysia, when multinationals began pouring their investments into Cyberjaya, building their shared services and outsourcing centres there.
Thus, I read with interest an article last week which quoted our deputy minister of international trade and industry as saying that one of the main features that attracted investors to Malaysia was political stability.
He went on to say that it was “unfortunate” his ministry will now have to rely on other “features” in its bid to promote the country, especially coming off the back of last week’s Bersih 2.0 rally. Read the rest of this entry »
Applying Prospect Theory To Ending Affirmative Action
Posted by Kit in Bakri Musa, Economics, NEP, UMNO on Thursday, 21 July 2011
By M. Bakri Musa
An insight of cognitive psychology (that sub-discipline dealing with mental processes like thinking and decision making) is that humans are far removed from the ideal of a rational self-interested Homo economicus (Economic man) when making decisions, contrary to the core assumption of traditional economics.
Two factors weigh heavily when we make decisions, given a set of alternatives. One, we are loss averse; that is, we magnify the value of a potential loss and minimize the potential gain even if the two are quantitatively the same. The other is that how those alternatives are framed very much influences our decision.
Although these insights refer to individual decision-making processes, nonetheless they can be extrapolated to the societal level, on how we collectively make decisions. This has relevance to the central wrenching issue dividing our Malay community today, on whether to continue or do away with affirmative action.
Read the rest of this entry »
Bersih asset freeze will scare investors, says DAP
By Boo Su-Lyn
July 16, 2011 | The Malaysian Insider
KUALA LUMPUR, July 16 — The government’s threat to freeze the assets of those involved with Bersih 2.0 will destroy Malaysia’s financial reputation as bad press abounds on the Najib administration’s handling of last weekend’s rally, the DAP said today.
Deputy Finance Minister Datuk Awang Adek Hussin said yesterday that Bank Negara Malaysia (BNM) can freeze the assets of those believed to be participating in activities deemed risky to the nation’s security. Read the rest of this entry »
The economics of compassion
by Erna Mahyuni
The Malaysian Insider
Jul 06, 2011
JULY 6 — The ETP is meaningless. Or at least it is to the man on the street. “Where do they get the numbers from?” a fellow I know asks me. The only numbers that mean anything to him right now are the prices of his food.
His shi cha (iced Chinese tea) and his chap fan (mixed rice) cost more these days while he isn’t earning more. And that is the reality for most Malaysians as we find prices rising while our incomes remain flat.
If the middle-class are feeling the pinch, what more those in the lower-income bracket? While the government spends millions on labs that are supposed to fix whatever problems we have, the poor remain poor.
I get angry when those who know nothing of poverty claim that with hard work, anyone can buy what they want or be who they want to be. Poverty is called a trap for a reason. It is easier to fall out of wealth than to come into it. And for those already poor or born into poverty, the odds are against them from the start. Read the rest of this entry »
Explain disparity between ‘actual’ and ‘approved’ FDIs, DAP tells Putrajaya
By Shazwan Mustafa Kamal
The Malaysian Insider
Jun 29, 2011
KUALA LUMPUR, June 29 — The Najib administration must explain the wide disparity between approved foreign direct investments (FDIs) and actual investment figures, the DAP said.
DAP national publicity secretary Tony Pua told reporters that a written reply by the Ministry of Trade and Industry (MITI) revealed that from 1996 to 2010 only RM179.8 billion out of the RM289.9 billion of approved investments had been realised.
“A shocking RM199.1 billion of declared FDI had disappeared without a trace,” he said in a statement today. Read the rest of this entry »
GST only removes tax burden on ‘wealthier’ minority, says Pua
Posted by Kit in Economics, Good Governance on Saturday, 25 June 2011
By Shazwan Mustafa Kamal
June 25, 2011 | The Malaysian Insider
KUALA LUMPUR, June 25 — Implementing the Goods and Services Tax (GST) while reducing the existing income tax will only benefit the “wealthier” minority, says Tony Pua.
The DAP national publicity secretary said that currently only 15 per cent of the working population earned enough to qualify to pay taxes, which meant 85 per cent of the country’s workforce earned less than RM3,000 a month. Read the rest of this entry »
Maybank, CIMB call off RHBCap takeover plan
by Izwan Idris
The Sun
23 June 2011
LUMPUR (June 23, 2011): Malayan Banking Bhd (Maybank) and CIMB Group have announced separately that they have aborted plans to take over RHB Capital Bhd.
“In light of recent developments and following further deliberations, the board of directors of Maybank has decided not to pursue the possible merger at this juncture,” Maybank said in a short statement to Bursa Malaysia today.
Maybank and its biggest local rival CIMB Group had obtained Bank Negara Malaysia’s approval last month to start merger talks with RHB Capital.
The announcement from Maybank was released after trading on Bursa Malaysia ended for the day. Read the rest of this entry »
Roubini Says ‘Perfect Storm’ May Threaten Global Economy
By Shamim Adam | June 13, 2011, 12:12 AM EDT
Bloomberg
June 13 (Bloomberg) — A “perfect storm” of fiscal woe in the U.S., a slowdown in China, European debt restructuring and stagnation in Japan may converge on the global economy, New York University professor Nouriel Roubini said.
There’s a one-in-three chance the factors will combine to stunt growth from 2013, Roubini said in a June 11 interview in Singapore. Other possible outcomes are “anemic but OK” global growth or an “optimistic” scenario in which the expansion improves.
“There are already elements of fragility,” he said. “Everybody’s kicking the can down the road of too much public and private debt. The can is becoming heavier and heavier, and bigger on debt, and all these problems may come to a head by 2013 at the latest.”
Read the rest of this entry »
Subsidies masking IPP ‘inefficiencies’, says think tank
By Lee Wei Lian
The Malaysian Insider
Jun 13, 2011
KUALA LUMPUR, June 13 — Independent Power Producers (IPPs) would have to charge much more than their Singapore counterparts if natural gas were sold to them at market rates, due to their bloated and inefficient cost structures, claimed Research for Social Advancement (Refsa) today.
The think tank estimated that local IPPs would need to raise their average prices from 25 sen/kWh to 74 sen/kWh if subsidies were removed and gas prices were allowed to rise from RM10.70/mmBTU to the present market price of RM47.42/mmBTU.
In comparison, Singapore power producers charge 41 sen/kWh.
“Put simply, if the gas subsidy in Malaysia is completely removed, the IPPs generation cost would be 80 per cent higher than that of power generators in Singapore,” said Refsa executive director Teh Chi Chang, noting that in Singapore fuel prices are market based. Read the rest of this entry »
Minister: Soi Lek approved diesel subsidy cuts
S Pathmawathy | Jun 13, 11
Malaysiakini
MCA president Dr Chua Soi Lek did not object to diesel subsidy cuts during the National Economic Council meeting when the matter was decided, revealed Domestic Trade, Cooperatives and Consumer Affairs Minister Ismail Sabri.
Speaking to reporters at the Parliament lobby today, Ismail said that Chua should have raised his concerns during the meeting instead of letting his party leaders complain now through the media.
“How can he now turn back and say it’s not fair? The MCA statement is unfair to government,” he said.
He added that the MCA should be helping the government in tackling protests by C2-class fishing trawler operators because the party had a hand in making the decision in the first place. Read the rest of this entry »
Welfare state: DAP dares Najib to enact minimum wage
Posted by Kit in Economics, nation building on Saturday, 11 June 2011
By Boo Su-Lyn
Jun 11, 2011 | The Malaysian Insider
KUALA LUMPUR, June 11 — As Umno and PAS battle over their welfare state policies, DAP’s Lim Guan Eng said today Penang’s welfare policies were sparked by Barisan Nasional (BN)’s failure to impose a national minimum wage and increase real wages.
Prime Minister Datuk Seri Najib Razak said yesterday that the results of the recent PAS party election was a victory for the DAP, pointing out that the new PAS line-up now championed a welfare state and not an Islamic one. Read the rest of this entry »
Ku Li calls for RCI on power deals
The Malaysian Insider
Jun 10, 2011
KUALA LUMPUR, June 10 — Veteran politician Tengku Razaleigh Hamzah today called for a royal commission to probe Tenaga Nasional Berhad’s contracts with independent power producers (IPPs), saying the lopsided deals may be burdening consumers.
“The commission must investigate and propose the best suitable measures to be taken by the government to ease the burden to be borne by the consumers following the inevitable increase in the electricity tariff after the IPPs charged higher rates to TNB,” the Gua Musang MP was quoted by Bernama Online today.
The Cabinet raised power tariffs by an average of 7.12 per cent effective June 1, in a bid to trim a growing subsidy bill and widening fiscal deficit.
But the move has also thrown the spotlight on the purchasing power agreements that TNB is engaged in with the IPPs. Read the rest of this entry »
Key resignation, resentment hits new national innovation initiative
Posted by Kit in Economics, Najib Razak, NEM, NEP on Friday, 10 June 2011
By Lee Wei Lian
June 10, 2011
The Malaysian Insider
KUALA LUMPUR, June 10 — Unik, the prime minister’s initiative tasked with restructuring the country’s public innovation ecosystem has hit a setback with the resignation of its technical advisor N Danaraj who was in charge of putting together the National Innovation Policy (NIP).
His resignation earlier this week could come as a blow to Unik due to the loss of experience as Danaraj has a masters degree in public administration from Harvard, a doctorate from Oxford and was also technical advisor to the National Economic Advisory Council (NEAC), a senior fellow at Khazanah Nasional and a research fellow at the Malaysian Institute of Economic Research.
His departure, which sources say was due to various disagreements with Unik CEO Dr Kamaljit Singh over the NIP, comes as several innovation agencies have been privately expressing concern over the Unik chief’s leadership style.
Read the rest of this entry »
Asia leads the world’s recovery, but high food and fuel prices threaten gains
Posted by Kit in Economics, globalisation, Prices on Tuesday, 7 June 2011
By Noeleen Heyzer and Nagesh Kumar
June 07, 2011 | The Malaysian Insider
JUNE 7 — Asia and the Pacific, more than any other region in the world, will experience greater transformation and change in the coming years, as the region’s economic strength plays a greater role in the global economy and as its population centers struggle to overcome the burdens of poverty, hunger, natural disasters and social inequalities.
The region’s economic growth figures, recently released in the UN ESCAP Economic and Social Survey of Asia and the Pacific 2011, indicate just how powerful Asia’s economy is for the world already.
The Asia-Pacific region recovered strongly in 2010 from the global financial crisis and recession of 2008-09 with the region’s developing economies growing at 8.8 per cent. In 2011, growth in developing economies of the region is forecast to be 7.3 per cent — lower than 2010’s high growth which represented a recovery from the low base of the 2009 recession. Read the rest of this entry »
The bigger subsidy addicts
By Sakmongkol AK47
June 07, 2011 | The Malaysian Insider
JUNE 7 — The favourite excuse of CEOs and politicians is always to attribute external factors as the cause of our inconvenience. Consider for example, the increase in electricity tariffs. Its unavoidable says the government because cost elements are increasing. What cost elements — workers’ wages and cost of fuels? What about subsidies going to IPPs? These are the bigger subsidy addicts who deserve the mandatory death sentence.
Many years ago, our country suffered the worse outage in our nation’s history. We were without electricity for many days. Manufacturers lost a lot of money. Industrialists were screaming their heads off and their voices reached Sri Perdana, the abode of the 4th PM then. Read the rest of this entry »
PwC says KL needs revamp to be competitive city
Posted by Kit in Economics, Good Governance on Tuesday, 7 June 2011
By Lee Wei Lian
June 07, 2011 | The Malaysian Insider
KUALA LUMPUR, June 7 — The city needs to improve its hard and soft infrastructure to compete with global commerce and culture capitals, says Andrew Chan Yik Hong, PwC Malaysia’ executive director in charge of capital projects and infrastructure.
This comes after PwC released a report (www.pwc.com/cities) this week predicting the trajectory of 26 select cities based on a wide range of criteria such as intellectual capital, transportation, health, economic clout, liveability and lifestyle assets.
Kuala Lumpur did not make the list.
New York topped the list, followed by Toronto, San Francisco, Stockholm and Sydney. Singapore was the top-ranked Asian city, finishing ninth on the list, ahead of Hong Kong (10) and Tokyo (14). Read the rest of this entry »
Subsidy flip-flops sign of deeper problems, say economists
Posted by Kit in Economics, Good Governance on Tuesday, 7 June 2011
June 07, 2011 | The Malaysian Insider
KUALA LUMPUR, June 7 — Economists perceive the Najib administration as prone to backtracking on policies, with political concerns trumping the need for economic reform.
In a scathing commentary published today by the Singapore Straits Times, the government’s dithering over subsidy cuts for energy and basic consumer goods was criticised by regional economists who are stirring a wider debate over the country’s long-term economic prospects.
The Straits Times said the big question being asked now was whether resource-rich Malaysia had fallen out of step with the global environment. Read the rest of this entry »
Respond to Ani’s expose, Najib told
By Teoh El Sen
June 6, 2011 | Free Malaysia Today
PENANG: The DAP has demanded that Prime Minister Najib Tun Razak explain why the public must suffer high electricity tariffs when the government could cut its subsidy bill by undoing the so-called “gas subsidy scandal” recently exposed by former Tenaga Nasional Bhd (TNB) chief Ani Arope.
Referring to Ani’s allegation that the Economic Planning Unit (EPU) forced TNB to accept lopsided purchase deals with independent power producers (IPPs) nearly 20 years ago, DAP secretary-general Lim Guan Eng said a review of those deals would be “more than sufficient” to reduce the subsidy bill.
“Clearly, there is no justification for Putrajaya to hike electricity tariffs by 7%,” he said.
Ani said in a recent Facebook posting that the EPU bullied TNB into buying electricity from an IPP at 14 sen per kilowatt hour (kWh) despite an existing offer of 12 sen. Read the rest of this entry »
As Malaysia’s assets wane, Umno scrambles for wealth control
Posted by Kit in Corruption, Economics, Good Governance, UMNO on Monday, 6 June 2011
By Shazwan Mustafa Kamal
June 06, 2011 | The Malaysian Insider
KUALA LUMPUR, June 6 — The fight is on for the country’s diminishing resources and assets, and leading the charge to secure rights to projects and land ownership are Umno warlords and politically-connected individuals.
As Malaysia grapples with imminent tariff hikes and a subsidy bill that could double to RM21 billion this year, individuals within the ruling Malay party appear to be wasting little time in demanding that the Najib administration award them immediate rights to government and commercial projects.
This is evident in the current tussle surrounding Umno’s attacks on UDA Holdings Bhd’s sale of prime land in downtown Kuala Lumpur, where despite the agency’s assurance that the sale to Mutiara Goodyear would benefit Bumiputeras, Umno leaders have attacked the agency, saying RM215.5 million deal would hurt Bumiputera interests. Read the rest of this entry »
Meniarap (planking) membantah kenaikan kadar elektrik
By Roketkini
4 June 2011
MUAR, 4 JUN – Marah dengan kenaikan kadar elektrik? Geram kerana harga barang juga akan turut naik? Bengang tapi tak pasti apa nak buat?
Apa kata tindakan kerajaan Barisan Nasional itu dibantah dengan mengambil gambar aksi “planking” atau meniarap di kawasan umum (asalkan bukan di tengah jalan raya yang sesak atau di litar perlumbaan Sepang sewaktu motosikal atau kereta sedang laju bersaing) dan dihantar ke laman sosial maya Facebook?
Juga pastikan apabila mengambil gambar aksi planking itu, ia tidak menghalang lalu lintas atau mengganggu ketenteraman awam. Planking yang merupakan aksi meniarap dengan merapatkan kedua-dua tangan dan lengan di sisi badan di tempat awam adalah fenomena bantahan biasa di seluruh dunia sejak sedekad lalu. Read the rest of this entry »
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