Archive for category Economics
Allah sentiasa bersama dengan orang zuhud
— Aspan Alias
The Malaysian Insider
Apr 11, 2012
11 APRIL — Saya sedang melalui pengalaman baru dan pengalaman ini sangat berharga bagi saya. Pengalaman yang saya maksudkan ialah mengenali lebih dekat lagi sikap Melayu Umno.
Rupa-rupanya masih banyak yang saya kurang faham tentang ahli-ahli Umno walaupun saya berada didalam parti itu selama 40 tahun. Agaknya saya tidak memahami pemikiran diluar kotak kerana saya terlalu taksub kepada Umno itu semasa saya berada didalamnya.
Saya hanya memahami dengan lebih dekat lagi sikap dan pemikiran mereka sejak saya mengambil keputusan menyertai Parti Tindakan Demokratik, parti momokan Umno sejak 46 tahun yang lalu. DAP itu komunis, DAP itu chauvinistik, DAP itu anti Melayu dan anti Islam dan DAP itu segala-galanya yang buruk. Segala “superlatives” buruk diberikan kepada DAP.
Yang menjaga Islam itu hanya Umno. Yang berjuang untuk Melayu itu hanyalah Umno, yang mempertahankan agama itu Umno , yang anti komunis itu Umno dan semua yang baik dan syumul itu Umno.
Mereka seolah-olah mengaku mereka sahaja yang akan masuk syurga dan saya yang masuk DAP ini akan menjadi ahli neraka. Tetapi kumpulan ini tidaklah ramai. Sebagaimana yang saya telah tulis dahulu penyertaan saya dalam DAP mandapat sokongan ramai orang Melayu juga. Read the rest of this entry »
Before being known as “Bapa Transformasi”, Najib must show he is not “Bapa U-Turn” first
Posted by Kit in Economics, Finance, Najib Razak, NEM on Friday, 23 March 2012
Less than 3 years into his term as the 6th Prime Minister of Malaysia, Najib Tun Razak has already been showered with the accolade of “Bapa Transformasi” courtesy of his many transformation programs. The litany of acronyms associated with Najib is like a never-ending alphabet soup – GTP, ETP, PTP, NEM, NKEA, NKRA, NEAC, EPP, SRIs.
One almost needs a reference dictionary to keep track of them. But despite his many programs, he is still very, very far from being a transformative Prime Minister. And his many programs are still very, very far from being transformative.
On the eve of what will be the most tightly contested general election in our history, Najib has shown a greater willingness to make U-Turns when faced with tough decisions that would have made Malaysia into a more progressive, liberal and vibrant country.
His various transformation programs are nothing more than expensive tax funded PR exercises that masks the business and politics as usual way of doing things that is taking place behind the scenes within the corridors of Putrajaya and within UMNO’s headquarters at PWTC.
Before Najib can earn the title of ‘Bapa Transformasi’, he needs to show that he is not ‘Bapa U-Turn’ first. Read the rest of this entry »
Get real Mr Prime Minister!
Posted by Kit in Economics, Najib Razak, Pakatan Rakyat, UMNO on Thursday, 22 March 2012
By Sakmongkol AK47 | March 22, 2012
The Malaysian Insider
MARCH 22 — Like many others, I read somewhat amused at PM Najib’s war cry that he is confident of getting back the states now under the opposition. I say war cry because here we have a PM seized by an extreme bout of paranoia declaring that we are at war. With who?
He has to stop the charade. It’s not like Umno and BN people are gifted with extraordinary talent that reserves them the right to govern the country. Who can argue against facts? The top three states which drew the highest FDI are Pakatan-led states. Just under one term, Pakatan governments can achieve these good things which no other BN lead states have ever achieved is an incontestable testimony that Pakatan people are more talented.
This is what Umno and BN and the Umno president fear most. That people are slowly but surely realising that there is life without Umno and what’s better, there is a better life without Umno. Let’s repeat this once more there’s life without Umno and there’s a better life without Umno indeed. Tell your friends, neighbours about this; let us kick out the kleptocratic maniacs out of Putrajaya and forge a new future. Let’s square off with Najib as the opposition leader. We will see he is a paper tiger who, without a scripted text, cannot respond to out-of-pre-approved questions.
Read the rest of this entry »
Putrajaya says ‘recycled’ projects part of ETP ‘ecosystem’
By Shannon Teoh | March 13, 2012
The Malaysian Insider
KUALA LUMPUR, March 13 — Putrajaya today defended its move to “recycle” two projects to be included into its Economic Transformation Programme (ETP), insisting were part of the “whole ecosystem” to push Malaysia into a high-income economy.
Deputy Minister in the Prime Minister’s Department Datuk S. K. Devamany told Parliament that it was unfair to single out projects like the Karambunai Integrated Resort and the Tanjong Agas Industrial Park as they formed part of a cohesive plan along with other megaprojects.
“It is part of a whole ecosystem where incentives such as infrastructure is given to encourage both local and foreign private sectors to invest. It’s a damn good programme.
“In principle, an EPP must fulfil two conditions, which is to have a significant impact on gross national income between 2010 to 2020 and to go through several rounds of consultation with stakeholders,” he said in reply to Ipoh Timor MP Lim Kit Siang.
Read the rest of this entry »
A Critique of the ETP: Part 6 – Socio-Economic Impact – The ETP will make the rich even richer
The ETP will be bad for wage-earners. Workers’ share of national income under the ETP will be just 21%, compared to 28% currently. Wage-earners’ losses will be corporate gains. The corporate share of ETP income will be 74%, up from 67% today. We fully support a vibrant corporate sector, but a healthy middle class is also crucial for sustainable high-income status. In developed economies, wages take about 50% of national income.
Income disparity will continue. The top 20% of households currently gobble up 49% of all household income. Under the ETP, the top 15% of wage-earners will tak 40% of all wages. The bottom 36% will have to make do with just 12% of total wages. It appears that KR1M thrift stores and Menu1Malaysia austerity meals will still be required in 2020 as the promised ‘high incomes’ benefit only a small minority.
The ETP will double our dependence on cheap foreign labour. If the ETP succeeds, there will be 16.2 million jobs and just 14 million workers to fill them. Who will fill the 2.2m million shortfall? The lower 1.2 million jobs the ETP creates will pay just RM1,100 in today’s terms. We would hope that Malaysians take the higher-paying jobs, which means that low-paid, poorly-skilled foreign workers will be required.
Read the rest of this entry »
A Critique of the ETP: Part 5 – Diversity – The ETP so far is just a handful of mega-projects
Just two mega-projects and Oil, Gas & Energy, really. Behind the apparently impressive RM176 billion of investments achieved in the ETP so far is a sobering picture. The MRT and Petronas’ RAPID mega-projects make up 55% of total investments in Entry Point Projects (EPPs). Going by National Key Economic Area, 53% of investments were in just one NKEA – Oil, Gas & Energy.
Zero progress in Financial Services. Not a single EPP has been announced in this NKEA which is targeted to deliver up to 15% of the income boost envisaged in the ETP. The Kuala Lumpur International Financial District is not a Financial Services EPP and is not even mentioned in Bank Negara’s Financial Services Blueprint 2011 to 2020. Is PEMANDU in sync with the key financial regulators Bank Negara and the Securities Commission?
Broad-based investments are necessary to transform Malaysia. The RM800 billion of investments targeted by the ETP are spread across 131 EPPs in 12 NKEAs. This will deliver the broad-based growth that will turn Malaysia into the high-income nation that PEMANDU envisages. But progress has been skewed towards just one NKEA and a few mega-projects. The ETP currently appears to be business-as-usual, government-linked mega-projects rather than private sector-led transformation.
Read the rest of this entry »
BN defensive as Penang tops manufacturing investment
By Lee Wei Lian
The Malaysian Insider
Feb 21, 2012
KUALA LUMPUR, Feb 21 — The performance of Pakatan Rakyat controlled states in attracting manufacturing investment prompted a minister today to play up the federal government’s role in their success.
The Ministry of International Trade and Industry released figures today that showed that the federal opposition controlled states of Penang and Selangor had recorded the highest levels of approved manufacturing investment in 2011, at RM9.1 billion and RM8.74 billion respectively.
This is the second year in a row that Penang and Selangor have topped the ranks for approved manufacturing investment and a sharp contrast to 2009 when Sarawak attracted the highest levels of manufacturing investment and Penang came in fourth.
Another Pakatan Rakyat (PR) state, Kedah came in fourth in 2011 with RM6.13 billion, behind Barisan Nasional (BN) controlled Sarawak which was in third place at RM8.45 billion.
The economic performance of PR states is closely watched as many voters and analysts use it as a gauge of whether the coalition is a viable alternative to the ruling BN. Read the rest of this entry »
A Critique of the ETP: Part 4 – Enterprise – Private enterprises are rejecting the ETP
The very basis of the ETP is in jeopardy. A key foundation of the ETP is that the private sector is to lead the massive RM1.4 trillion of investments needed to catapult Malaysia to high-income status by 2020. But the 35% private sector share of ETP investments to date is far below target. The RM114 billion investments by government and GLCs are nearly double the RM62 billion invested by the private sector.
PEMANDU obfuscating again. PEMANDU responds that private sector investments are closer to the targeted 60% share if big-ticket public sector projects like the MRT are excluded. This is intellectually dishonest. The ETP Roadmap Report includes such projects in its desired investment mix. There is no justification to exclude them. It is akin to giving a recipe for a rich chocolate cake and then saying it is not fattening if you exclude the calories from the butter.
Is PEMANDU attempting to cover up tepid private sector response? We would expect the big-ticket, long-gestation infrastructure projects to be prioritised in the early days of the ETP. However, PEMANDU has chosen to obfuscate rather than clarify. Is it because the gap between the desired 60% private sector target and the current 30% is unlikely to be bridged?
Read the rest of this entry »
A Critique of the ETP: Part 3 (iii) – Execution (iii)- Doubtful EPPs; doubtful achievements and due diligence
Some PEMANDU ‘achievements’ are doubtful. The Karambunai Integrated Resort and Tanjong Agas Oil and Gas Park do not appear viable and their private sector developers are financially weak. These two EPPs alone account for 7% of the total investments trumpeted by PEMANDU during the first year of the ETP. Their inclusion weakens the credibility of the headline investments, national income and job accretion that PEMANDU claims to have achieved.
Karambunai IR – expensive and crowded? The investment cost for this project in rural Sabah soared from RM3 billion to nearly RM10 billion in the six short months from its first mention before the ETP was launched to its final incarnation as an EPP. At this price, we estimate it needs 2.8 million visitors per year to break-even – more than all the passengers arriving at Kota Kinabalu airport!
Aghast at Tanjong Agas. The massive investment and construction work in this fishing village will result in infrastructure that duplicates the thriving towns of Kertih and Gebeng, which are the stated focus areas for oil and gas activities in the Eastern Corridor Economic Region. PEMANDU will no doubt deny that the infrastructure is redundant, and maintain that the transformation of this village is unrelated to its location in Pekan, the parliamentary constituency of Prime Minister Datuk Seri Najib.
Read the rest of this entry »
A tale of two classes: Inequalities in Malaysia
— S.M. Mohamed Idris
The Malaysian Insider
Feb 10, 2012
FEB 10 — The government’s aim is to achieve a high-income economy by 2020 must equally benefit all Malaysians. We cannot have a society where one small elite group is living in luxury, while one big part of the society is struggling to survive.
The income inequality gap
According to Dr Muhammed Abdul Khalid, a research fellow with University Kebangsaan Malaysia, although Malaysia has made great strides in reducing poverty and inequality (especially between ethnic groups) from 1970 to 1990, the inequality remains high post-1990.
It has remained almost at the same level for the past 20 years; in fact, the inequality in Malaysia is among the highest in the region. Read the rest of this entry »
A Critique of the ETP: Part 3 (ii) – Execution (ii) – The hothouse labs probably killed innovation
The ETP resulted from 12 ‘labs’. Each lab comprised 30-50 experts who had 8 weeks to research best practices and innovations, distill them in intense brainstorming sessions and support them with detailed analysis. The result was 131 Entry Point Projects (EPPs) across 12 National Key Economic Areas (NKEAs) that would maximise gross national income with minimal public-funding support. Such is the PEMANDU narration.
Truly transformative ideas may have had no chance. Much was made of the private sector participation. But large companies would naturally dominate. Start-up companies, even if invited, cannot afford to release staff for 8 weeks. Consider this example: Ten years ago, Microsoft, IBM and HP would have dominated any lab to transform the IT industry. Google was a cash-strapped start-up, Apple was in disarray and Facebook did not even exist. The incumbents would have been free to promote pet projects and stifle their competition.
Hothouse environment favoured incumbents with existing business plans. The tight time frame incentivised lab participants to select EPPs for which research was ready, rather than pursue alternatives. In addition, private sector participants would be expected to lobby heavily for their pet projects. Their duty is to maximise profits, not embark on public service ventures. Unless properly steered, the labs would be inclined to select heavily-promoted projects rather than the most transformative.
Read the rest of this entry »
A Critique of the ETP: Part 3 (i) – Execution (i) – PEMANDU strengthens the ‘know-who’ cancer
Very swift progress, but is it due to PEMANDU? In its 8 ETP updates so far, PEMANDU has announced multiple new EPPs (Entry Point Projects) worth billions of ringgit of investment and creating thousands of jobs. One EPP – Johor Premium Outlets (JP Outlets) – is already open. But how much of this rapid execution is due to PEMANDU instead of normal private sector efficiency?
Opportunistic naming of existing projects as EPPs. For example, the JP Outlets and St Regis Hotel projects pre-dated the ETP. Their completion dates were unchanged by their subsequent EPP status – suggesting minimal input by PEMANDU. Naming them as EPPs gives the illusion of quick wins and overstates PEMANDU’s success.
PEMANDU might have indeed helped. PEMANDU might respond that these projects would have been delayed without its help in cutting red tape. Note that the developers Genting-Simon Property and Chua Ma Yu-MRCB are global multinationals, a prominent local businessman and a GLC.
Read the rest of this entry »
A Critique of the ETP (Part 2) – We won’t really be twice as rich in 2020
By Dr. Ong Kian Ming BSc (LSE), MPhil (Cantab), PhD (Duke)
Teh Chi--Chang, CFA, BSc (Warwick), MBA (Cantab)
Refsa | 25 January 2012
RM48,000 in 2020 is not real income. The ETP promises to double gross national income (GNI) per capita to RM48,000 by 2020 from RM23,700 in 2009. However, RM48,000 in 2020 will be worth a lot less than RM48,000 today, just like RM100 today buys a lot less than RM100 eight years ago, thanks to ever-rising prices. If Malaysians are really to be twice better off, nominal income must be RM64,000 by then, to compensate for the 2.8% per year inflation that PEMANDU expects.
Nothing transformational in the RM48,000 target. This target is for nominal income, which includes inflation, and not real income, which strips out inflation. Because of inflation, nominal GNI per capita growth averaged 8.2% from 2001-2010, whereas real GNI grew only 3.2%. At the historical average 8.2% per year growth rate, nominal incomes will exceed RM48,000 by 2018 anyway, with or without the ETP or PEMANDU.
PEMANDU and its expensive consultants cannot even get basic mathematics correct. If the income target is RM48,000, PEMANDU’s 6% real GNI growth rate and 2.8% inflation forecasts are wrong. If its growth and inflation forecasts are right, then the RM48,000 target is wrong – it should be RM54,145 in 2020, not RM48,000. Furthermore, key metrics of some EPPs – the investment value, GNI contribution and jobs created – are unavailable.
Read the rest of this entry »
Khazanah sold Proton for no profits?
Mohd Ariff Sabri Aziz | January 25, 2012
Free Malaysia Today
The ‘Che Det Consensus’ is an economy built around problem solving that is ‘practical’ only for the Malaysia’s business and Umno political elite.
COMMENT
I found it odd the statement from Khazanah Nasional Bhd that it didn’t make profit from its sale of Proton Holdings Bhd’s shares to DRB-Hicom Bhd. If no profits were made, why sell the shares?
Secondly, Khazanah’s statement can be construed as an admission that it was given a fait accompli – take this price and don’t ask any questions. In Malaysia, only one person can do that – the man who can walk on water – Dr Mahathir Mohamad.
I hope I can throw more light on the sale of Proton shares to DRB-Hicom. Were there any other bids besides DRB-Hicom presented to Khazanah?
Is Khazanah brave enough to publish the identity of all the bidders?
If it has the courage to do so, we shall not be surprised if the bidders were the Tengku Mahalil-Arumugam group, DRB-Hicom and Nazmi and company. And they all have only one master – Mahathir. Read the rest of this entry »
For its own sake, Greece needs to declare default
by Costas Lapavitsas
Sydney Morning Herald
January 25, 2012
The dreadful debt saga will only come to a close when Athens takes charge of its predicament, writes Costas Lapavitsas.
Negotiations to reduce Greek debt have been suspended after no agreement could be reached last week. At some point in the near future, Greece seems certain to default on its obligations. But the drama surrounding the talks in Athens, Berlin and Paris shows that there will be nothing co-operative about a Greek default. It is a ruthless contest dominated by the so-called troika: the European Union, the European Central Bank, and the International Monetary Fund.
At every turn, the interests and rights of people across Europe have been disregarded. Negotiations have proceeded in secrecy. Greece, whose government is led by an unelected central banker, is represented by a team of politicians and technocrats who have performed lamentably during the crisis. Those who are owed money by Greece have been represented by the Institute of International Finance, a self-styled mouthpiece for bankers.
The troika has accepted that Greek debt must be reduced to sustainable levels. However, it also wants the reduction to appear voluntary because, if the lenders were coerced, Greece would be declared in formal default, and banks and financial markets would be thrown into crisis. Read the rest of this entry »
Let Malaysian Chinese unite as one Dragon and together with other Malaysians, effect a change of power in Putrajaya in 13GE
With the closer approach of the 13th General Elections, whatever the date decided by the Prime Minister to dissolve Parliament, one common aspiration uniting Malaysians is gathering momentum – the possibility and potential for change of power at the federal level for the first time in the nation’s 54 year history.
Let Malaysian Chinese unite as one Dragon in the Year of the Dragon and, together with other Malaysians, effect a change of power in Putrajaya in the 13th General Elections to fulfill Malaysia’s potential as an united, harmonious, democratic, just, prosperous and competitive nation.
In his pre-Chinese New Year walk-about in the Federal Territory on Friday, Datuk Seri Najib Razak claimed that Malaysia is the best place in the world to live in as it provided the “best value for money”.
This is the strongest reason why Malaysia needs a change of federal power because the powers-of-the-day in UMNO and Barisan Nasional suffer from an incorrigible disease of denial complex in refusing the admit the failures of government and nation-building in the past few decades which have driven some two million of the best and brightest Malaysians to foreign lands for they could not get respect and recognition or able to hold their heads high as Malaysian citizens in their own homeland.
Read the rest of this entry »
A totalitarian/absolutist economy
— Art Harun
The Malaysian Insider
Jan 20, 2012
JAN 20 — The establishment, nourishment, protection and subsequent embellishment by any government of entities (corporate or otherwise) with monopolistic businesses and/or preferential treatment signal the rise of what I would term as totalitarian economy.
A totalitarian economy operates and behaves in manners not unlike a totalitarian or absolutist state. By its very nature, it feeds off compulsion and force, disallows and even destroys competition and gives no option nor choice to the consumers. It is beyond scrutiny as it is not answerable to any entity, let alone the very consumers which it aims to supply.
As a result of the totalitarian and absolutist approach, this economy owes little, if at all, affinity to the concepts of fairness and justness.
It is like a black hole. It swallows everything which is in its way. It then grows bigger. And bigger.
The only difference is that, unlike the real black holes, a totalitarian economy only grows bigger within the confines of the parameters defined by its own creators. Throw this economy into unchartered territory, the real capitalist would just laugh its head off. With a mere snap of the capitalist’s finger, this totalitarian economy would be history.
That is not surprising. As a result of the constant nourishment, protection and forced embellishment of this economics absolutism/totalitarianism, such economy knows not how to compete. Its supernova-like explosive birth and subsequent growth deprives it of the ability to learn and to grow organically. This totally underdeveloped creature — underdeveloped in the sense that it is bereft of the elements which would ensure its vibrancy and survival in unchartered territories — has no defence mechanism nor the ability to adapt to changes within its surrounding, preferring to coil within the comfort of its mother’s lap. Read the rest of this entry »
A Critique of the ETP (Part 1) – Let’s evaluate PEMANDU on its DEEDS
By Dr. Ong Kian Ming BSc (LSE), MPhil (Cantab), PhD (Duke)
Teh Chi-Chang, CFA, BSc (Warwick), MBA (Cantab)
Refsa | 19 January 2012
The Economic Transformation Programme is ambitious indeed. The ETP promises to double gross national income (GNI) per capita to RM48,000 by 2020 from RM23,700 in 2009. An average 6% per year real income growth over 10 years and 12.8% per year private investment growth over 5 years is required to achieve this. Ultimately, RM1.4 trillion of investments in 131 Entry Point Projects (EPPs) within 12 National Key Economic Areas (NKEAs) will create 3.3 million new jobs.
Predictably, there are critics. Any plan as bold as this is bound to attract critics. But the attacks so far have mainly been against specific projects, such as the MRT and 1 Malaysia email; carping about the slick façade and expensive costs at PEMANDU – the Performance Management and Delivery Unit, prime minister’s department – the government agency that created and is now steering the ETP; or questioning the viability of its lofty targets.
We will evaluate PEMANDU on its DEEDS. In this series, we shall evaluate PEMANDU and the ETP on its own terms by looking at the goals and plans outlined in the ETP Roadmap document. So, for example, rather than questioning its ambitious targets, we shall analyse how well it is measuring up to those aspirations. Doing so facilitates constructive debate as it uses the same framework which PEMANDU has chosen to work within.
Read the rest of this entry »
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. Read the rest of this entry »
Malaysia 2012 Growth to Miss Official Target, Institute Says
Bloomberg
By Chong Pooi Koon
January 19, 2012
Jan. 19 (Bloomberg) — Malaysia’s growth will probably miss the government’s forecast this year amid the faltering global economy, according to the Malaysian Institute of Economic Research.
Southeast Asia’s third-largest economy will expand 3.7 percent in 2012, the partly-government funded institute said in a statement in Kuala Lumpur today, cutting its earlier estimate of 5 percent gross domestic product expansion. This is below the 5 percent to 6 percent government forecast in its Oct. 7 budget statement.
“Economic growth will likely get bumpier in the months ahead,” the institute said in the report. “Growth in the last quarter of 2011 is expected to be much lower on account of external developments. Latest monthly economic indicators are already suggesting that.”
The World Bank said yesterday developing growth in Asia- Pacific economies will slow for a second straight year on Europe’s debt crisis and weaker global trade. Malaysia likely expanded 4.9 percent in 2011, the institute said, missing the government’s growth forecast of as much as 5.5 percent. Read the rest of this entry »
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