|Things are looking up|
|Sunday, 18 February 2007|
GOOD news is in short supply these days. Some cheer before the Chinese New Year is surely a cause for celebration.
Like many Malaysians, I have decided to spend moderately this festive season. The prices of many food items have gone up and most of us are cautious over how we manage our household budget.
We have been reading in the newspapers about the country's numerous economic successes but the trickle-down effect has yet to be felt. Ordinary Malaysians will tell you that their biggest worry is the increasing cost of living.
For many wage earners, it is a daily struggle to keep their bills down as they juggle with their expenses.
Still, the series of feel-good announcements is important because it is an indicator of the country’s economic performance.
Last week, it was reported that a record RM46bil was invested in 1,077 approved projects last year by local and foreign investors, a 48% jump from the RM31bil invested in 2005.
Last year’s figure was the highest chalked up to date, exceeding Malaysia’s Third Industrial Plan target. The projects approved are expected to create about 90,000 jobs.
Foreign direct investments (FDIs) have also soared with the Japanese investing RM4.4bil last year, followed by the Dutch, Australians, Americans and Singaporeans.
Last year, Malaysia attracted prominent players to set up regional headquarters in the country, including General Electric (US), Eppendorf AG (Germany), Aker Kvaerner Group (Norway) and Nippon Electric Glass (Japan).
Before this, the Government announced that Malaysia’s trade figure hit RM1tril, reportedly the highest in the country’s history.
While government leaders have highlighted the figure as a big achievement, critics have dismissed it as a gross simplification because import numbers were not stated.
But the fact is the stock market has been bullish. It has continued to chart new heights over the past weeks as foreign funds pour into Malaysian stocks.
There are reasons why foreign fund managers are eyeing Malaysia. Bangkok is no longer on their radar screen following the flip-flop decision on currency control by the military regime.
More importantly, there is no bad news in Malaysia. Yes, we can do without some of the silly, foot-in-the-mouth statements by some of our politicians but generally Malaysia is a stable country.
We are often too critical of ourselves. We tend to overlook our successes and when the slew of upbeat stories is published, it is received cynically.
The private sector, the driving force of the country’s economy, has done well in terms of corporate earnings and in transforming itself.
While there are concerns that foreign hedge fund managers will pull out once they have made their profits, most analysts believe that the bullish trend will continue until next year.
There are no good reasons why foreign funds should leave Malaysia if there are profits to be made.
Another point is that the ringgit has become stronger.
However, we should not be too quick to claim that the good times are back – many restaurants and retail outlets are not exactly doing fantastic business.
Let’s not kid ourselves, lest we lose credibility. The small and medium enterprises still face problems, including getting loans, and many have expressed concern over the low purchasing power of consumers.
Small businessmen – and not only gamblers – have had to turn to loan sharks because of cash flow problems.
Second-hand car dealers will tell you how bad they have been hit while taxi drivers quite willingly share their unhappiness with passengers.
Graduates find it hard to get jobs because businesses are careful about hiring new staff to keep costs under control.
It would be more appropriate to say that better times are ahead. The many projects worth billions of ringgit under the 9th Malaysia Plan will begin soon and the spill-over effect will follow.
Once the physical structures are up, Malaysians will be able to see and feel the development that has been planned.
Economists have predicted a growth of between 5.3% and 5.5% for the country, which is considerably good.
To sustain this economic drive, Prime Minister Datuk Seri Abdullah Ahmad Badawi has correctly set up the 23-member task force to promote quicker reform of the delivery system.
If we do not improve our delivery system and cut down on red tape, we will lose our competitive edge. It does not make sense for a developer to seek approvals from 144 government agencies or wait three to five years for a building plan to be approved.
Even Vietnam, which is a socialist state, has gained a reputation for being fast and efficient while in Dubai, builders are told within two weeks whether their plans have been approved.
The weaknesses have been identified and new mechanisms are being put in place to make Malaysia more attractive to investors.
Malaysians expect more good news in the coming months leading up to the National Day celebrations.
As Malaysians celebrate the Chinese New Year, they can toast each other for better times ahead.
For the Chinese community, the daily showers for the past few days have been a relief during this season of hot weather. For many, lok sui (rain in Cantonese) rhymes with money.
Gong Xi Fa Cai!
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