Wednesday, December 02, 2009

Is the 2nd Finance Minister for Real?

The Second Finance Minister gave a keynote speech at the National Economic Outlook Conference 2010-2011 organised by the Malaysian Institute of Economic Research on the 1st December, which must have shaken the audience to the core, not because the content of his speech had anything new or shocking, but because it was the first time a Finance Minister had stated the obvious which all Malaysians knew about, with regards to the country's economy.

According to the AFP report, Datuk Seri Ahmad Husni Hanadzlah said:
"Malaysia is trapped in a low-value-added, low-wage and low-productivity structure," Second Finance Minister Ahmad Husni Hanadzlah (left) told an economic outlook conference. Among its peers China, India, Vietnam, Indonesia, Philippines and Thailand, Malaysia's economic growth over the past three years was second-lowest, he said.

"Our economy has been stagnating in the last decade. We have lost our competitive edge to remain as the leader of the pack in many sectors of the economy. Our private investment has been steadily in decline... While Singapore and Korea's nominal per capita GDP grew within the last three decades by 9 and 12 times respectively, ours grew only by a factor of four."

In a withering assessment, Ahmad Husni said the services sector is underdeveloped, private investment is half the levels before the 1997-98 Asian crisis, and the manufacturing sector is suffering from lack of investment.

...He called for sweeping measures including an emphasis on meritocracy and ensuring all Malaysians are given "equal opportunity to participate in the economy".

"We must also consider the gradual dismantling of our open-ended protection of specific sectors and industries which have introduced a climate of complacency and artificial levels of supply... The long-term success of the nation's economy must take precedence over the short term interests of a few protected groups."
This is a speech which sounds as if it has been lifted word for word of the blogs of the Pakatan Rakyat leaders! In fact we have been saying the same over the past decade and we are ecstatic that a Finance Minister is finally listening for it is better late than never.

However, the “earth-shaking” speech will be a sheer waste of time and effort if it is not put into real concrete actions. We would like to call upon the Minister to move a ministerial statement on the country's real state of the economy and to allow for debate in the Parliament so that both sides of the house can unite for once on the urgent “wide-ranging reforms” needed to restart the country's engine of economic growth.

This is particularly urgent in the light of recent measures by the Government which runs completely counter to what the 2nd Finance Minister has raised such as the direct award of the mega-Matrade Exhibition and Convention Centre to Naza TTDI which serves the “short term interests of a few protected groups” and the complete lack of competition in the other projects awarded by the Government resulting in the continued decline in competitiveness.

Hence we hope that the Cabinet Ministers will no longer sing unbelievable and unrealistic praises of the Malaysia's economy in Parliament when responding to queries from its members. Instead they should all discard the knee-jerk denial syndrome mentality to ensure an honest assessment which is critical to adopting the right measures to heal the malaise in our economy.


KoSong Cafe said...

The same man who said we lost an estimated Rm28 billion through corruption?

Yet, BN seems to bark up the wrong trees in trying to source out revenues by introducing GST, re-introducing RPGT, etc., when MACC holds the key to the prevention of losses through leakages and corruption.

If only political support did not depend on contracts and other goodies from the powers that be, and expenditure is based on necessity rather than feeding the demands of the supporters.

Unknown said...

Dear Sir,
Go according to the report of Ahmad Husni Hanadzlah's speech, it is really a shocking blow as you have commented in your blog.
As a Malaysian ourselves, we are sad to get to know our country's economy grow is under stagnated and powerless.
It's pointless to find anyone's fault to burden the responsibility for the present bad economy unfavorable situation. Our country's economy isn't becoming iced stone in one night. Its out come has already in the making when public fund was malicious carelessly used up by vanity and full of unending naivety. Undetected embezzling of public fund by government officials has caused government tantamount loses of billion ringgit yearly.
In accordance with the parliament report, lack of deliberation improper spent of government fund destitute chance of national improvement. Destination to success of economic betterment is far away unable to touch on. If the whole government has the consciences, hearty love for this country they have mismanaged, they have to resign themselves from holding of office. Bravely step down and leave it to other much capable politicians to run this country. Malaysian people will be feeling much gratitude for them.

Anonymous said...


Your last paragraph, "We hope....", will never happen.

Hoping for so many bloody years yet still hoping meh..?? What makes you think these goons will change..???

Have they ever..???????
Anyway, can't tahan longer. Am migrating....

Malaysia..? No comment..!!!

KL Management Services said...

In many ways, the Malaysian economy is very strong and we have a lot of reasons to believe that Mr. Mahathir has a lot to do with its growth - Not to mention all the other prime ministers and their big ideas.

However, if ideas are not big enough, or not being heard, it's the same thing.

Just like when a financial controller or economist forecasts certain things in the future. If nobody were to follow, then what's the point?

You should make us trust your judgment. By doing right things.

Hopeful said...

Hope this is not another NATO(No Action Talk Only).Hope this not another sandiwara talk by BN.Hope????Tak Tau Sampai Bila? Hope GE13 is tomorrow.

Anonymous said...

What do we take from this? Is this just a lone minister who understand the problem OR is this that BN top leaders understand the problem but do not have the will? I seriously doubt BN entirely understand the problem and able to understand it. The bottom line is that if they have someone who understand it and yet fail to change significantly, they are unable to change...

Unknown said...

Dear Sir,
After reading your articulate report of our country's economy down turn and national treasury reserves is nigh of its emptiness by the act of overspending exorbitantly, it has made one may wonder why it has become into such an astonishing eventuality.
I do believe you may be worry about it conscientiously since you have the duty to remind the current government to take cautious control of the uses of national fund.
Since the embarrassing destitute situation of Malaysian treasury is high up to reach the nose, imposition of taxation is inevitable implemented by government, what will be going to happen next?
It has already tremendously caused the great anxiety to all Malaysians at large.
If PR is given a mandate to take over the federal government, in such an unfavorable economic situation, will PR able to overcome such troublesome financial problem for the nation?
PR has to prepare for it.
In the speech of second financial minister is full of evasion. His evasive answer to opposition lawmaker questions are showing their ministry has found it difficult to tackle the present economic reddish.
Recently, bad news from Dubai, its financial crisis might be the greater sparing to blow off Malaysian government high expectation of its investment return. At the moment government has said nothing about it or denied it officially.
There were many mismanagement cases of public fund by BN led government in previous years. Dubai may be another one of it. Petronas and EPF had been used to bail out all the financial turmoils created by BN government careless marketing strategy by appointing mediocre in-charges to run the shows.
Would they (BN elites) willing to listen to you?
Did they (BN elites) really take your suggestions for consideration to remedy the present full of cavities national economic stagnation?

kl_boy said...

my bet is that the treasury is having cash flow problems hence the disclosure

Anonymous said...

There are too many unsolved misuses of public fund.
PKR Tian Chua revealed BN's ministers and present MB of a state transferred millions of ringgits to oversea for safe keeping was not stirring up any astonishment among people or government was concerned. It funnily shows that people are already fed up of it and take it as usual illegal commitments done by BN elites.
Should MACC conduct investigation on it and find out the truth?
How come they are having so much moneys to transfer to oversea for safe keeping?
Is it an ill-gotten wealth?
Even a gold mine will be collapsed when gold deposition is dug finished. Not to say a poorly managed government, it will soon be going bankrupt.
After so many years of misusing public fund by mismanaged government and misdeed official embezzlement, national debt will be high up that will definitely cause disastrous chain reaction in the near future.
It can be predicted its embarrassing economic predicament will be making people's life as harder as stepping on the hot burnt rock.
It's time dues to make changes. The change of government is a must. BN must go!
Second finance minister was talking the truth of it. It was socking indeed in his speech.
What reaction they have in mind?
Due to such unfavorable economic predicament Bn has faced, what radical plan are they going to revamp it, if opposition providing offered remedy suggestion is not heeded?

Anonymous said...

90% rhetoric (talk is cheap, just implement it). Probably to pave the way for the NEW ECONOMIC MODEL.

We have all been disappointed MANY times over the past two decades. Just too much VESTED interests in UMNO.

Anonymous said...

Still remember what happened to Zaid! I'm sceptical...

rodinia said...

ks jomo has recently edited an excellent book on the weakness of our msian economy.

Anonymous said...

When there is no level playing field for all, policies change without rhyme or reason, bureaucracy and inefficiency rules, the government and the judiciary is opaque, education and social policies are regressive, then no major MNC will invest in Malaysia.

OTOH, the local economy cannot be mobilized as the engine of growth for the same reasons as above.

Complexity economics, which consider the economy as an adaptive evolutionary system, proposes that creating the environment for "variation, selection and amplification", will create wealth.

Does Malaysia have the political will to transform itself to go down this path?