Archive for category Finance
Penghapusan duti eksais kereta: Sekali lagi BN kata tak wajar
Posted by Kit in Finance, Pakatan Rakyat, Transport on Friday, 27 July 2012
— Aspan Alias
The Malaysian Insider
Jul 25, 2012
25 JULAI — Niat Pakatan Rakyat untuk menghapuskan duti eksais dan berbagai cukai terhadap kereta-kereta adalah usaha yang patut mendapat sokongan. Ini adalah kerana kereta adalah perkara keperluan oleh rakyat negara ini yang masih terlalu jauh ketinggalan dalam menyediakan kemudahan pengangkutan awam. Sesungguhnya rakyat telah terlalu terbeban dengan kos pembelian kereta kerana sebahagian besar dari harga jualan kereta di negara ini adalah disebabkan oleh elemen cukai-cukai seperti duti eksais yang tinggi yang dikenakan oleh pihak kerajaan kita.
Jika duti eksais diturunkan ketahap minima maka kereta import yang berharga sebanyak RM150,000 itu akan boleh didapati dengan harga RM120,000 misalnya. Malahan kalau kita kaji harga kereta di banyak negara maju ia adalah jauh lebih rendah dari harga kereta yang rakyat kita terpaksa bayar. Harga kereta di negara ini terlalu tinggi dan kita adalah bersamaan dengan negara-negara seperti Singapura dan segelintiran negara di-rantau ini.
Itulah sebabnya ramai di antara rakyat negara ini, apabila kembali ke Malaysia kereta adalah salah satu ‘item’ penting yang dibawa mereka kembali kerana mereka telah membeli kereta-kereta tersebut dengan harga yang amat murah di luar negara. tetapi cadangan ini jangan kita harapkan mendapat sokongan dari pihak parti yang memerintah sekarang kerana mereka tidak akan bersetuju untuk memberikan sokongan dan alasan ‘standard’ yang diberikan mereka ialah tindakan itu akan mengbangkrapkan negara.
Pihak BN telah memberikan reaksi yang negatif terhadap isu ini dan Ketua Pemudanya Encik Khairy Jamaluddin telah menyatakan jika ini terlaksana maka ia akan mengurangkan pendapatan negara dalam jumlah yang berbillion ringgit setahun. Kita tidak boleh melayani pandangan ini kerana beliau (Khairy) adalah di pihak pimpinan dan kerajaan yang tidak mempunyai cukup imiginasi untuk mencari pendapatan alternatif terhadap kekurangan pendapatan dari tindakan mengurangkan duti eksais dan cukai-cukai yang berkaitan dengan harga kereta ini. Read the rest of this entry »
The bitterness of a financial conservative
by Hafiz Noor Shams
The Malaysiann Insider
Jul 26, 2012
JULY 26 — I handle my finances conservatively. I spend very little for someone my age and my profile. In fact, I impose a sort of limit on my spending. I am conscious of it and get mildly nervous if my total spending grows too fast even when I can more than afford it.
I probably do buy too much insurance and I do save or invest a large part of my earnings. My credit card service provider probably hates me for having to finance me without getting the chance to charge me interest too often too much.
I can afford to save a lot partly because I do not have too many financial responsibilities.
The other factor behind my saving habit has a lot to do with my upbringing and education. Read the rest of this entry »
Is Petronas an ungrateful child of Malaysia?
Anas Alam Faizli
Free Malaysia Today
July 12, 2012
In early June Petronas hinted publicly at the World Gas Conference that they are tired of being the Malaysian government’s cash cow. They said no to fuel subsidy and last year they said they wanted to pay less dividends! Is Petronas ungrateful? The money belongs to the rakyat anyway and hence the government.
While many have attempted to comment on the sustainability of Petronas’ payouts, this article aims to give some insights into the realities of the local oil & gas industry, and why returning all oil harvests back to Malaysians may not benefit them in the longer run.
In 1974, Petronas, fully owned by the government of Malaysia, was established and given full ownership and control of our Petroleum reserves. Today, it has evolved into a fully integrated oil and gas multinational corporation, ranked among FORTUNE 500’s largest and most profitable oil and gas corporations with a total workforce of more than 30,000. Read the rest of this entry »
WSJ: Malaysia needs China’s help to weather euro storm
The Malaysian Insider
Jun 20, 2012
KUALA LUMPUR, June 20 — Trade-dependent Asian countries including Malaysia will take a major hit if the euro zone economy collapses and will require China’s aid to hobble along, according to the Wall Street Journal (WSJ).
The newspaper highlighted the point that Malaysia has bank loans from Europe equal to 20 per cent of its gross domestic product (GDP), which it said was high for the region, and would be more troubled compared to financial hubs Hong Kong and Singapore, both of which have huge “rainy-day funds” to keep homes and businesses above water.
While China, the world’s biggest economy after the US, would be able to withstand the global slump due to its closed financial system, WSJ said Malaysia’s growth would be lessened.
“If China doesn’t open the stimulus floodgates, that would mean less of a boost for its neighbours, including commodity exporters such as Australia and Malaysia,” the paper said. Read the rest of this entry »
Election spending risks credit downgrade, say S&P and Moody’s
Posted by Kit in Economics, Elections, Finance, Najib Razak on Thursday, 26 April 2012
By Shannon Teoh
The Malaysian Insider
Apr 26, 2012
KUALA LUMPUR, April 26 — The federal government’s record spending binge ahead of elections expected within months may result in Malaysia’s first credit-rating downgrade in 15 years.
Bloomberg reported today that several top rating companies say Putrajaya must bring down its debt, the second highest in Asia at 53.8 per cent of GDP or face a ratings cut.
The international business wire cited Standard & Poor’s (S&P) analyst Takahira Ogawa as saying it “might have to think about” a potential cut in a few years unless the next government boosts revenue and reduce subsidies after polls.
It also reported that Moody’s Investors Service and Fitch Ratings also said Malaysia must cut its debt, which the International Monetary Fund (IMF) projects may climb to a 20-year high of 55.9 per cent this year, above the statutory 55 per cent ceiling.
A downgrade to Malaysia’s credit, rated as A- by S&P, would be its first since the 1997 Asian financial crisis.
The rating is the same as Botswana, which has a debt ratio of 16 per cent, while Indonesia, Southeast Asia’s largest economy, is rated BB+ by S&P and has seen its debt fall to 25 per cent in 2011 from 95 per cent just after the crisis. Read the rest of this entry »
Malaysia after regime change
Posted by Kit in Corruption, Elections, Finance, Politics on Saturday, 24 March 2012
— Tricia Yeoh
The Malaysian Insider
Mar 24, 2012
MARCH 24 — The intricate nexus between the worlds of business and politics has been an age-old tradition in Malaysia. Crony capitalism, a term to describe the intertwined relationship between business, politicians and the state, where individuals in the private sector benefits by obtaining licenses, concessions, government subsidies, other forms of protection from governments and appointments to key state owned enterprises through their close relationship with politicians and bureaucrats.
The main questions to ask in the event of a regime change are: Will it really ever be possible to extricate one from the other, given the context where this is an assumed norm? Second, how would a new government go about making these drastic changes?
There has been recognition of this problem by political players from both sides of the divide.
The Pakatan Rakyat (Pakatan) Shadow Budget admits, for example, that “Pakatan will face resistance from cronies that desire to perpetuate patronage and rent-seeking” when it begins to attempt open tenders and a more transparent procurement policy.
Prime Minister Najib Abdul Razak also announced that a new initiative under the Government Transformation Programme (GTP) would regulate financing for all political parties, where all funding must be channelled to an official party account. He said that “a proper receipt record” would “prevent corruption and misappropriation on a grass-roots’ level…” 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 »
Huge O&G growth a poser for Malaysia’s future
By Lee Wei Lian
The Malaysian Insider
Feb 22, 2012
The government would be unable to finance its operational expenditure without oil revenues, according to the World Bank. When last year’s investment figures were released yesterday, one statistic stood out — the stunning 132.7 per cent growth in the mining sector — and painted a picture of a two-speed economy where oil-and-gas was booming while other sectors grew slowly or even registered declining investment.
This comes as the World Bank warned last November that Malaysia is too dependent on fossil fuel revenues, with its non-oil primary deficit having doubled in the last five years to almost 20 per cent of GDP.
The other concern is that oil and gas would continue to compete for talent and funds that could be used to broaden the country’s economic and wealth base, especially in home-grown science and high technology, areas in which Malaysia is an insignificant player. Read the rest of this entry »
DAP: Gov’t manipulated laws to legitimise debt
Posted by Kit in DAP, Finance, Good Governance on Friday, 17 February 2012
Malaysiakini
Feb 17, 2012
DAP has blamed the country’s rising debt level to the ruling BN having raised the statutory borrowing ceiling “multiple times” to legitimise the debt.
DAP national publicity secretary Tony Pua slammed the government for modifying the ceiling “at its whims and fancies over the past decade, rendering meaningless the legal debt ceiling”.
Therefore, he said, the government’s debt at 53.8 percent of GDP as reported in the Economic Report 2011/2 is below the statutory borrowing ceiling of 55 percent, is purely the result of the government’s “creative manipulation”.
“What is worrying is the fact that the ‘statutory borrowing ceiling’ has actually been raised multiple times by the BN government over the past decade to ‘legalise’ the federal government debt level which has been increasing at a much faster pace than our GDP.
The 55 percent statutory borrowing ceiling only came into effect in July 2009 by order of current second finance minister Ahmad Husni Hanadzlah.
“Prior to the revised limit, the limit was set at 45 percent in June 2008, barely 13 months before by the then second finance minister Nor Md Yakcop,” said Pua in a statement today.
He added that the limit was raised to 40 percent five years before that, by then second minister finance minister Jamaluddin Jarjis.
“Hence our statutory borrowing ceiling has been raised by 15 percent of our GDP in just six years. Read the rest of this entry »
DAP: RM97b in hidden loans pushes public debt over legal limit
Posted by Kit in Auditor-General Report, DAP, Finance on Thursday, 16 February 2012
By Shannon Teoh
The Malaysian Insider
Feb 16, 2012
KUALA LUMPUR, Feb 16 — The DAP today accused the government of not reporting RM96.9 billion in loans it has guaranteed as public debt, which would push the amount of federal loans above the 55 per cent of gross domestic product (GDP) allowed by law.
Party publicity chief Tony Pua said the combined public debt of RM455.7 billion reported last year and the “off-balance sheet” financing would amount to RM552.6 billion, or 65.2 per cent of the economy.
“For all intents and purposes, even though these loans are not taken by the government, they are essentially government debt or otherwise known as contingent liabilities.
“This expanded figure would then constitute 65.2 per cent of our GDP, well above the 55 per cent federal government loan limit as defined in the Loan (Local) Act 1959 and Government Funding Act 1983,” Pua (picture) said in a statement today.
Malaysia’s national debt has been a hotly debated issue after the Auditor-General said in October it grew by 12.3 per cent to over RM407 billion in 2010, or 53.1 per cent of GDP. 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 »
Breaking up wealth concentration in Malaysia
Posted by Kit in Finance, Lim Teck Ghee on Wednesday, 1 February 2012
— Dr Lim Teck Ghee
The Malaysian Insider
FEB 1 — The past year has seen the government and the opposition unveil their respective economic reform policies. Even if these reform policies and their attendant programmes are implemented they will not be able to resolve the country’s economic problems. This is because the policies advocated by both sides of the political divide are merely palliative. They do not address the root or fundamental cause of the problem of structural deformation of the country’s economy.
How has this deformation come about? What are its characteristics? And what can be done to bring about a reversal or correction of the deformation so that we have a really transformed economic system that can live up to its full potential?
First we need to recognise that wealth in any country — and Malaysia is no exception — is created by economic activity engaged in by individuals or enterprises that bring profits or gains to the entrepreneur. Much of this wealth creation and subsequent accumulation is legitimate. It is based on material reward arising from work (or gift) and is socially and ethically acceptable. It comes from risk-taking and from the social utility and superiority of the products and services generated by the individual or enterprise.
Wealth generated and accumulated by individuals through legitimate means and conforming to the norms of justice and fairness is not only desirable but beneficial to society and the economy.
But what about wealth that is created or amassed by less than legitimate or illegitimate or illegal means? Is it a minor or non-issue and do we just ignore it as is the case with the Barisan Nasional government? Read the rest of this entry »
Saudi: no cash from emerging economies until given more clout
Posted by Kit in Finance, international economic crisis on Tuesday, 24 January 2012
By Andrew Torchia
Reuters
Mon, Jan 23 2012
RIYADH (Reuters) – Big emerging economies such as China, India and Saudi Arabia will not aid the West in its financial crisis unless they are given more influence in running the global economy, a senior figure from Saudi Arabia’s ruling establishment said on Monday.
“The financial crisis and great recession were born in the West, developed in the West yet hit hard throughout the world,” former Saudi intelligence chief Prince Turki al-Faisal said in a speech to a business conference in Riyadh.
He said this showed the need to give emerging economies more representation and more authority in global bodies such as the Group of 20 nations, a forum of the world’s major industrialized countries, and the Financial Stability Board (FSB), which discusses regulation of banks and financial markets.
So far, however, organizations such as the FSB “have yet to take these new realities into consideration,” while the G20 is making little headway in coordinating economic policymaking around the world, he said.
Big emerging economies’ lack of influence in international bodies reduces their willingness to contribute money to fight the global crisis, the prince warned.
The International Monetary Fund is seeking to more than double its war chest by raising $600 billion in new resources to help countries deal with the fallout of the euro zone’s sovereign debt crisis. 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 »
Guan Eng says national debt ‘dangerous’, potentially disastrous
Posted by Kit in Economics, Finance, Lim Guan Eng on Wednesday, 11 January 2012
By Shazwan Mustafa Kamal
The Malaysian Insider
Jan 11, 2012
KUALA LUMPUR, Jan 11 — Massive borrowing and irresponsible spending by the Barisan Nasional (BN) government will result in Malaysia becoming a fully indebted nation before the end of the decade, Lim Guan Eng said today.
The Penang chief minister said that Putrajaya’s debt to Gross Domestic Product (GDP) ratio has increased yearly from 53.1 per cent in 2010 to 53.8 per cent last year and is expected to hit 54.8 per cent this year.
“This is extremely dangerous, and even more disastrous when coupled with statistics from Bank Negara’s Annual Report 2010, which revealed that Malaysia’s household debt at the end of 2010 was RM581 billion, or 76 per cent of GDP, thus giving us the dubious honour of having the second-highest level of household debt in Asia, after South Korea.
“In absolute terms, federal government debt rose by 71 per cent in four years to RM456 billion at (the) end (of) 2011 from RM266 billion at end (of) 2007,” said Lim in a statement today.
The DAP secretary-general said by following the same expansion rate, national debt would be a projected RM780 million by 2016 and RM1.3 trillion by 2020. Read the rest of this entry »
National debt to equal GDP by 2019 if Putrajaya remains spendthrift, say economists
By Yow Hong Chieh
The Malaysian Insider
Jan 10, 2012
KUALA LUMPUR, Jan 10 — Malaysia’s national debt will hit 100 per cent of the Gross Domestic Product (GDP) by 2019 should Putrajaya continue to borrow more than it earns, economists say.
Malaysian Institute of Economic Research (MIER) distinguished fellow Mohd Ariff Abdul Kareem warned that the federal government revenue was growing too slowly to keep up with its borrowings, which hit 53.1 per cent of GDP in 2010.
He said while the current size of government debt relative to GDP was not troubling, the pace of its growth in recent years was cause for concern.
Debt-to-GDP ratio jumped from 41.4 per cent in 2008 to 53.1 per cent in 2010 while government debt grew 14.6 per cent in 2008 and 18.3 per cent in 2009, far outpacing the country’s GDP growth, Ariff noted.
“If nothing is done to reverse the current trends in government expenditures and revenues, extrapolation suggests that Malaysia’s national debt will explode to 100 per cent of GDP by 2019.
“Should the debt growth gather speed, this can happen sooner,” he told The Malaysian Insider via e-mail. Read the rest of this entry »
Umno’s missed opportunity
Posted by Kit in Corruption, Finance, Najib Razak, UMNO on Saturday, 17 December 2011
Awang Abdillah | December 17, 2011
Free Malaysia Today
Issues of national concern were not discussed at the recent Umno general assembly. Delegates also failed to call on Najib to step down for Umno to rise again.
COMMENT
Frankly, the recent Umno general assembly was the best venue and probably the last chance for Umno leaders to show their sincerity in addressing party and national concerns.
Instead of adopting the Mahathir doctrine or rather its despotic policy, Umno president and Prime Minister Najib Tun Razak should have discussed with the party leaders on how best to tackle the party and national problems.
Disgruntled members should have urged Najib to step down as one of the solutions for Umno to rise again. Personal leadership, party strength and national issues and problems are all inter-related.
Glaringly missing at the Umno general assembly were discussions on issues of national concerns. Read the rest of this entry »
Malaysia rises in illegal money chart, RM150b lost in 2009
By Shannon Teoh
The Malaysian Insider
Dec 15, 2011
KUALA LUMPUR, Dec 15 — Malaysia lost RM150 billion in illicit outflows in 2009, the fourth highest in the developing world, says US-based watchdog Global Financial Integrity (GFI).
According to its report on illicit financial flows from developing countries released today, Malaysia lost a total of US$338 billion (RM1.08 trillion) over the first decade of the century.
“This report should be a wake-up call to world leaders that more must be done to address these harmful outflows,” GFI director Raymond Baker said in a press release.
GFI had reported in January that RM930 billion flowed out of Malaysia from 2000 to 2008, growing to RM218 billion per year from an initial RM71 billion in that period.
It said the increase was “at a scale seen in few Asian countries.” Read the rest of this entry »
Malaysia among most vulnerable to euro crisis, says Nomura
Posted by Kit in Economics, Finance, international economic crisis on Wednesday, 7 December 2011
By Lee Wei Lian
The Malaysian Insider
Dec 07, 2011
KUALA LUMPUR, Dec 7 — Malaysia will be hit harder than its Asian peers by the economic crisis in Europe due to its relatively weak public finances and dependence on commodities, said Nomura International today.
Its chief economist for Asia ex-Japan, Robert Subbaraman, said that unlike most countries in Asia, Malaysia will be negatively affected by an expected drop off in commodity prices while the government will also find it difficult to keep up stimulus policies.
“Malaysia is one of the economies that will weaken the most; it is in the weaker group of economies,” said Subbaraman at a media briefing here today.
Nomura economist for Southeast Asia Euben Paracuelles said Malaysia’s growth in the first three quarters of this year was largely led by government spending, but as public finances were relatively weak, he doubted that it would be sustainable.
Subbaraman also noted that Malaysia ranked third in Asia ex-Japan in terms of exposure to European bank claims, after Hong Kong and Singapore, which could mean a drying up of liquidity should European banks start to cut their exposure to the region. Read the rest of this entry »
Sinking deeper and deeper
Posted by Kit in Budget Debate, Economics, Finance, Financial Scandals on Wednesday, 2 November 2011
By S JAYASANKARAN, KL CORRESPONDENT | 31 Oct 2011
Business Times
MALAYSIA should take heed of the problems – the public anger, the social unrest – posed by the solutions offered to tackle rising sovereign debt in Europe. God forbid that we head that way!
The Auditor-General’s recent report pointed out that Malaysia’s national debt rose 12.3 per cent to over RM407 billion (S$165 billion) in 2010. The amount is equivalent to 53.1 per cent of gross domestic product. It’s the second straight year that the national debt has exceeded 50 per cent.
The figure is a reflection of the spending spree the country went on to mitigate the effects of the 2009 global financial crisis. At its peak that year, the budget deficit rose to 7.6 per cent of GDP, the highest in two decades.
It has since come down to 5.4 per cent of GDP and the government projects that it will decline further to 4.7 per cent of GDP next year. But that may be overly optimistic.
Read the rest of this entry »
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