"THE latest World Bank report shows that Malaysia’s economy is growing weaker.
Out of the 15 Asian economies analysed in the report, Malaysia and a few others are the only ones expected to worsen.
The World Bank forecasts that under current conditions, in 2018, Malaysia’s growth rate will lower to 5% and in 2019, decrease further to 4.8%.
There are less than three months to go until 2018.
As the new World Bank report describes Malaysia’s economy: “The main risks to growth arise from the policy uncertainty in the major economies, geopolitical developments and commodity price volatility.”
While most Asian economies are rising, Malaysia’s is in decline, because it has not adapted to both global and domestic economic conditions.
The report also singled out Malaysia as one of only two Asian economies where household debt “exceeds 70% of GDP”. Many economists have concluded that Malaysia’s debt bubble is about to explode.
As others have correctly noted, the gross domestic product numbers and global economic rankings with which Najib is obsessed haven’t benefited Malaysians.
As the World Bank country manager for Malaysia Farid Hadad-Zervos recently warned: “This is the fundamental question: what does GDP really mean in the daily life of Malaysians?”
During his failed US visit, Najib said Malaysia’s 5.2% growth is “the envy of advanced economies”. To which everyone should immediately respond: “Iraq had 11% growth, Bangladesh had 7.1% growth and Ethiopia had 7.6% growth last year – should they be the envy of the advanced economies, too?”
Instead, Malaysia is falling behind its Asian neighbours.
As Bloomberg reported last month, Indonesians and Thais are the world’s top 10 populations where the highest numbers of millionaires are being created, increasing by 13.7% and 12.7% respectively.
Unlike its Asian neighbours, Malaysia still has not entered either the G20 or the trillion-dollar GDP club (Barisan Nasional’s latest target is a trillion ringgit).
According to the United Nations, today the Malaysian youth unemployment rate has skyrocketed to 12.1% and rising – approximately quadruple the national unemployment rate. A recent Bank Negara survey showed that three out of four Malaysians find it difficult to raise even RM1,000 in an emergency.
Najib is notorious for falsifying economic data in his speeches, selectively quoting reports, omitting bad economic news, and twisting the complete economic portrait of Malaysia, because he is politically unstable.
In the recent best-seller The Rise and Fall of Nations, the author describes a particularly hilarious but disturbing story about Najib’s inability to understand the Malaysian economy:
“On a visit to New York in October 2015, one of my colleagues asked (Najib) whether the collapse of the value of the ringgit is offering any boost to the nation’s embattled manufacturing sector. He answered by missing the point, saying the cheap ringgit is great for tourism, which can be an important contributor to growth in a country as large as Malaysia. Pressed on the manufacturing question, Najib seemed at a loss. An aide in the back of the room pitched in to help, but spoke about investing in oil and other raw materials. The crowd left with the impression that Malaysia is missing an opportunity, because the cheap currency coupled with the right reforms could supercharge Malaysian manufacturing.”
All Malaysians should read the new World Bank report to draw their own conclusions about whether Barisan Nasional is missing additional opportunities for growth – or whether it’s more focused on protecting the elite few. – October 9, 2017."
The actual World Bank Report (overview) said this:
"From an economy dominated by the production of raw natural resource materials, such as tin and rubber, even as recently as the 1970s, Malaysia today has a diversified economy and has become a leading exporter of electrical appliances, electronic parts and components and natural gas. After the Asian financial crisis of 1997-1998, Malaysia continued to post solid growth rates, averaging 5.5 percent per year from 2000-2008. Malaysia was hit by the Global Financial Crisis in 2009 but recovered rapidly, posting growth rates averaging 5.7 percent since 2010.
Less than 1 percent of Malaysian households live in extreme poverty, and the government’s focus has shifted toward addressing the well-being of the poorest 40 percent of the population (“the bottom 40”). This low-income group remains particularly vulnerable to economic shocks as well as increases in the cost of living and mounting financial obligations. Income inequality in Malaysia remains high relative to other East Asian countries, but is gradually declining. For example, from 2009 to 2014 the real average household incomes of the bottom 40 grew at 11.9 percent per year, compared to 7.9 percent for the total population of Malaysia, thus narrowing income disparities. Following the removal of broad-based subsidies, the government has gradually moved toward more targeted measures to support the poor and vulnerable, mainly in the form of cash transfers to low-income households.
Malaysia’s near-term economic outlook remains favorable, reflecting a well-diversified and open economy that has successfully weathered the impact of external shocks. Domestic demand is expected to continue to anchor economic growth, supported by continued income growth and a stable labor market, while an improving external environment would contribute positively to demand for Malaysia’s tradable goods and services. Accelerating structural reforms to enhance public sector performance and boost the productivity of public spending will be vital to sustain robust growth in a challenging external environment.
While significant, Malaysia’s productivity growth over the past 25 years has been below those in several global and regional comparators. As factor accumulation is expected to slow, accelerating productivity growth is the main path for Malaysia to achieve convergence with high-income economies. Accelerated implementation of productivity-enhancing reforms to increase the quality of human capital and create more competition in the economy will be key for Malaysia to secure a lasting place among the ranks of high-income economies."
Spot the difference, did you? It is almost a new story. One wonder how they justify this other than for purely political motives.
I am not a great lover, much less supporter, of corrupt regimes like Zimbabwe and South Africa but there is still a duty of care, a moral repsonsibility, for reporters and the media to tell the truth.
I have said this before in a previous 'Blog' but it rears its ugly head up once again. We all denounce Trump for his infamous attack on 'Fake News' and we applaud the media for defending themselves but, in reality, who is right?
No doubt that Trump is in need of psychiatric help but can he be wrong all the time?
I fear that calling on the media to present the truth is a long shot but we can always hope and, in the meantime, ignore much of what they say.
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