Thursday, July 29, 2010
Tony Pua's agenda to demonize Najib's NEMeconomics
PJ Utara DAP MP Tony Pua, who is also DAP’s propaganda Chief is set to demonize PM Dato’ Seri Mohd. Najib Tun Razak’s effort to improve the economic position, especially with the New Economic Model bold agenda of doubling the income per capita within 10 years.
The Malaysian Insider reports:
FDI crashing because investors lost faith, says DAP
KUALA LUMPUR July 25 — A lack of confidence in Malaysia’s economy has driven foreign direct investment FDI to our neighbours leaving the once-roaring “Asian tiger” to compete with Indochina countries the DAP said today The World Foreign Investment Report WIR 2010 released by the United Nations showed that FDI in Malaysia plunged 81 per cent last year trailing behind countries like the Philippines Vietnam Thailand Indonesia and Singapore “For the first time ever in history Malaysia attracted less investment than the Philippines ” DAP national publicity secretary Tony Pua said in a statement today Pua pointed out that Malaysia was the only Asean country to experience negative FDI flow in 2009 The Philippines attracted US$1 95 billion RM6 24 billion in FDI compared to Malaysia’s US$1 38 billion while Singapore raked in the most — more than US$16 billion “Among Southeast Asian nations we are now only attracting more FDI than Cambodia Myanmar Brunei Laos and Timor-Leste ” added Pua “What was previously unimaginable that we may one day be compared to countries such as Cambodia and Myanmar is now a real possibility ” said the Petaling Jaya Utara MP pointing out that those countries had also attracted less than US$2 billion in FDIs last year Prime Minister Datuk Seri Najib Razak has been trying to lift Malaysia’s profile as a destination for foreign investment to help the country achieve an average gross domestic product GDP growth of at least six per cent per annum over the next five years But 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 The Najib administration has also warned that the economy may slow down in the second half of the year due to external factors but have insisted that a six per cent growth was still achievable Today Pua also said that Malaysia had suffered the biggest decline of FDI in Southeast Asia from 2008 till 2009 “The government cannot use the excuse of the global financial crisis as the reason for the precipitous drop in FDI as we have performed the worst compared to all other countries big and small in the region ” said Pua Data revealed that Malaysia suffered a large 81 1 per cent drop in FDIs compared to far healthier figures in Thailand 30 4 per cent Vietnam 44 1 per cent and Indonesia 44 7 per cent However Singapore Brunei Philippines and Myanmar still managed to register positive growth said Pua Pua also DAP’s chief economist pointed out that Malaysia was the sole Southeast Asian nation to have registered a net negative FDI flow last year Najib was criticised for stalling on the NEM “Malaysia was the only country where our outflow of FDI amounting to US$8 04 billion is substantially greater than the FDI of US$1 38 billion received ” said Pua “Not only are foreign investors unwilling to invest in Malaysia our own local investors as well as foreign investors who are already in the country have a total lack of confidence in the ability of our economy to generate an attractive return to their investments ” added Pua He pointed out that Malaysia’s net FDI flows have declined from US$2 56 billion in 2004 and US$1 09 billion 2005 to a net negative US$0 02 billion 2006 negative US$2 7 billion 2007 and negative US$7 67 billion in 2008 “Despite Datuk Seri Najib repeatedly insisting that the era where ‘the government knows best’ is over his administration continues to crowd out private investments by directly awarding mega-projects to government-linked entities such as the Sungai Buloh land to an Employee Provident Fund joint venture with the government or the Sungai Besi airport redevelopment to the 1 Malaysia Development Fund ” said Pua “Without these necessary and critical changes to the government’s economic policies the Malaysian economy will only continue to drift away from the radar of both local and foreign investors ” he added Pua went on to criticise Najib for not moving ahead with his New Economic Model pointing out the prime minister had been forced to call it a “trial balloon” after a sour reaction from some Malay groups.
The truth is far from what has been described. Tony Pua is using the 2009 figures to back his claims that the economy is not so bullish and losing out FDIs to our neighbours. The analysis is comparatively weak as the correspondong period of analysis was no longer relevant, in the context of the real economic propulsion programs ever since PM Najib took charge and new policies, which include liberalisation to 27 subsectors announced.
MITI under Dato’ Seri Mustapha Mohamad is bullish and confident of realising RM 115 billion of FDIs for the next 10th Malaysia Plan (2010-15). The growth set is at 12.8 % annually as compared to an average of 2% per annum during PM ‘Flip-Flop’ Dato’ Seri Abdullah Ahmad Badawi’s watch.
Bernama.com report on the matter:
M’sia Optimistic to Woo RM115 Billion Private Investment by 2015
KUALA LUMPUR, 26 JULY, 2010: Malaysia is optimistic of wooing RM115 billion private investment by 2015 in line with the target set under the 10th Malaysia Plan, says International Trade and Industry Minister Datuk Seri Mustapa Mohamed.
He said the Government Transformation Plan would create a conducive environment for investment flow.
“RM115 billion investment represents foreign direct investment and Malaysia’s investments overseas. The six per cent gross domestic product growth forecast this year is achievable,” he said.
Mustapa also said there was potential investments from South Korea particularly in the property sector.
To date, investments from South Korea totalled US$3 billion, he said.
Mustapa said there are indications that South Korean companies are keen to increase their investments in Malaysia.
“We should exploit this potential with South Korea’s aggressive investment overseas,” he said.
The latest investment from South Korea is the acquisition of Malaysia’s largest petrochemical producer, Titan Chemicals Corp Bhd, by Honam Petrochemical Corp.
Another investment by South Korea is the plan to set up a solar cell manufacturing plant at the Senai Hi-Tech Park in Johor by STX Corp.
Mustapa said interest in Malaysia’s property sector among South Koreans was also promising as they see Malaysia as an ideal place to live due to good quality of life and safe environment.
Meanwhile, at the Business Councils meeting with the International Trade and Industry Ministry today, Mustapa said strategic partnership promotion and ways to boost trade and investment took centrestage.
Among the Business councils which attended the meeting are the Malaysian-French Chamber of Commerce and Industry, Malaysian-Swedish Business Association, Malaysia-Norway Business Council, Malaysia-Italy Chamber of Commerce and Industry and Malaysia-Dutch Business Council.
The East Asia Business Council and Malaysia-Japan Economic Association also attended the meeting.
Mustapa also said there was a need to enhance the ministry’s database system to provide comprehensive information on foreign investors and trade.
“We discussed ways to share information and to complement the information with the foreign countries,” he said.
He said the currrent database system focused on information gathered from the Malaysia Investment Development Authority (MIDA), mainly on companies that have received incentives from MIDA.
“Some companies which don’t have large investments are not captured,” he added.
The fact is that PM Najib’s effort to restore the confidence of investors in the active campaign to meet industrialists and financiers in his trips to the US, EU, Japan and China is very much reflected in the first quarter’s FDI alone almost match with the whole of 2009 FDIs.
Human capital is one of the agenda to uplift the capabilities and competencies of the Malaysian workforce, to realise the expectations of the high value economy demands. Newly formed agencies such as the Talent Corporation is designed to source for the necessary talents from outside, to meet the shortfall of the demands. The Federal Government is also investing in over RM 1.5 billion a year for human capital programs, which include training and skill-sets uplifting programs for new and existing workforce.
To facilitate the influx of FDIs and promotion of further expansion of already existing MNCs, the rules of ownership have been relaxed. New banking and finanncial services license issued and better process for industries to be set up is being actively introduced.
2009 was particularly a bad year for business. Since the subprime financial meltdown in the US during the second half of 2008 and escalated to EU, the Malaysian economy is not spared. The lakclustre and lack of faith to PM ‘Flip-Flop’ Abdullah’s weak administration compounded to the poor FDIs attracted for 2009.
Pua should instead clearly demonstrate if DAP controlled Penang State Government under DAP Secretary General Lim Guan Eng did manage to attract FDIs for 2009-10 actually faired much better against what Gerakan led BN Penang State Governemt under Tan Sri Koh Tsu Koon did. The proof is a must for the State Government’s based on its own initiatives and not initiated by Federal Government campaigns, which is spearheaded by MIDA and NCIA. CM Lim and Excos did a lot of trade missions on their own and the effectiveness is yet to be seen.