Come clean on economy, Pua urges government
UPDATED @ 01:51:55 PM 07-07-2010By Boo Su-Lyn July 07, 2010
KUALA LUMPUR, July 7 — DAP national publicity secretary Tony Pua demanded today an honest assessment of the economy after the prime minister suggested the possibility of slower growth in the second half of the year.
“For the past three months, the Malaysian government has been singing praises about the Malaysian economy... what happened now?” asked Pua today.
“We want the prime minister (Datuk Seri Najib Razak) and his ministers to come up with an honest assessment of the country’s economy,” he said in Parliament today.
Minister in the Prime Minister’s Department Tan Sri Nor Mohamed Yakcop had also said yesterday that Malaysia’s economic performance was “not so well” in the second quarter, but insisted the country was not headed for a double-dip recession.
Malaysia’s economy grew by an impressive 10.1 per cent in the first quarter of this year, marking two straight quarters of growth following three consecutive quarters of serious contraction last year.
Despite signs that the United States is set to join Europe on the economic slow lane, Nor Mohamed had argued that Malaysia remained on track towards meeting its annual growth target of six per cent.
“The government must come up with an honest assessment on where we are... and how to mitigate the slowdown,” Pua told reporters today.
Pua, also the Petaling Jaya Utara MP, cited signs of the economic slowdown such as analysts from the US cutting growth rate forecasts while banks in China were selling loans.
“We must not deceive ourselves,” said Pua.
Najib had said yesterday that despite the uncertainty in the external sector, the Malaysian economy remains resilient.
To sustain the growth momentum, Najib had said the government will ensure the implementation and close monitoring of all measures outlined in the 10MP.
The Najib adminstration has been trying to introduce economic reforms and spending cuts but has been faced with stiff public opposition.
Najib has also been trying to lift Malaysia’s profile as a destination for foreign investment to help the country achieve an average GDP growth of at least six per cent per annum over the next five years.
Malaysia’s FDI rates have fallen faster than other regional players like Singapore and China, and at the same time capital outflows have dampened private domestic investments. Net portfolio and direct investment outflows had reached US$61 billion (RM197 billion) in 2008 and 2009 according to official data.
The government will allocate between RM90 billion and RM91 billion for expenditure in the first two years of the 10MP Najib’s government has set among the key challenges of the 10MP the stimulation of the private sector investments to grow at 12.8 per cent annually or RM115 billion.
It was reported that the country may not be able to achieve the six per cent GDP growth target if the 12.8 per cent growth is not achieved within five years.
Najib has said that it was important for Malaysia to have a robust domestic demand to spur and balance the economy.
He has also added that while the global economic environment had improved, there are downside risks to the recovery, including the sovereign debt crisis in Europe and the slow recovery in the United States.