IntroductionIt worries me to see the state of the economy at the moment. Thousands of workers in manufacturing factories, production plants, electronic firms, banking sectors, equity groups, and the financial sector are badly affected.
Lack of assignments and projects occur not only in small players but among the largest firms in Malaysia as well.
Fresh graduates also face unfavourable responses from many companies - "We are freezing employment temporarily. Do come back to us in the future when times are better".
Malaysians are feeling the effects. But are we at the lowest yet?
Najib's economic plan 1Najib Tun Razak will takeover as the 6th Prime Minister of Malaysia. His first big involvement in Malaysia's economy was when he announced the 3% EPF contribution cut for all.
A Piece of My Mind disagreed with Najib's policy with a simple economic model as explanation back then.
However, as an Economist, I have to agree that the EPF policy was implemented to improve consumers' liquidity and money circulation of the economy in the short run.
The EPF cut policy will end 2 years from the date of implementation. It will and it must. Read more on why I think the 3% EPF cut must not be a long term tool.
Najib's economic plan 2In view of the global economic crisis, Najib launched a RM 7 billion stimulus package.
Malaysia's economy is a RM 500 billion economy in constant year 2000 prices and a RM 640 billion economy in current year prices (2007).
If RM 7 billion or any of those small stimulus packages can transform a bearish market into a bullish one, then Malaysia's economy is really unique (or should I say weird?).
The mini-budgets and small scale stimulus package will not be sufficient. Najib needs to look into things deeper and perhaps take Dr Mahathir's idea into consideration. [Mahathir: Govt can inject another RM 28 billion].
Economists and the business sectors feel that the stimulus package is insufficient and Najib has yet to announce anything big. The 'delay' will cause a massive problem for Malaysia because stimulus packages are not instantaneously felt by the people but a lagging period exists.
I understand that something big will be announced on March 10th. I hope it is big enough to move the RM 640 billion economy. [Najib: Second Stimulus Package To Be Stronger]
I am also worried after reading this news report - Malaysia's budget transparency: Surprised and embarassed.
Najib's administrationEven though many bloggers stopped attacking the Fourth Floor of PM's Dept, the No. 1 blogger of Malaysia did not.
I suggest that Najib increases the participation of the Finance Ministry, Transport Ministry, Works Ministry, MITI and EPU in decision makings to move Malaysia from a Contender country to the Developed status. [Malaysia is not a developing but a contender country]
ConclusionNajib Tun Razak will takeover a leadership which is facing a strong Opposition. He has successfully shut out Anwar's crossover threats for the next four years.
The people are angry about crossovers and party hopping. Anwar will not be able to threaten Najib with crossover claims to PR. Otherwise, Anwar will face the anger of the people.
With Anwar's wings clipped, Najib Tun Razak must focus on rebuilding the Government system and developing Malaysia or lose the support base not only among Malaysians but also inside UMNO with several leaders waiting to takeover the leadership at the sidelines.
(Credits to MStar, NST and TheStar for the photos)