Malaysia unveils its second stimulus plan

Malaysia’s first stimulus plan last year was inadequate. So the government unveiled a second stimulus program this month. In his speech at the Parliament, Malaysia’s Deputy Prime Minister and Finance Minister defended the stimulus package:

The thrusts of the Stimulus Package are as follows:
– First : Reducing Unemployment and Increasing Employment Opportunities;
– Second : Easing the Burden of the Rakyat, in particular, the Vulnerable Groups;
– Third : Assisting the Private Sector in Facing the Crisis; and
– Fourth : Building Capacity for the Future.

He adds that “The Government is confident that the strategies and measures outlined in this Stimulus Package are comprehensive to prevent our economy from slipping into deep recession.”

We cannot depend on orthodox economic recovery policies. We must be bold in formulating innovative approaches to deal with the crisis. This is a very challenging time for all of us. We must be ready and strong to face the challenges ahead. We must draw upon our past experience to overcome the crisis.

myAsylum thinks the stimulus plan will not work:

Bailout sounds bad, but stimulus sounds positive, even though if analyzed, the RM 60B package doesn’t seem like it was designed to stimulate much of anything that can be construed as productive. Except maybe stimulate the public sector into growing even more bloated than it already is

E Contrario points out that the package does not address unemployment and poverty in Malaysia:

The package left out institutional reforms, made no mention in strengthening regulatory mechanism and improvement of economic governance.

As a result, we learn nothing from the crisis. We have not even embarked on any serious institutional reforms after we were hit by 1997 Asian Financial Crisis.

The package has not addressed the crisis of massive unemployment and escalating poverty, especially urban poverty.

We are uncertain what will be mechanism to ensure funds injected into the economy can ‘trigger’ down to the bottom of the society. While uttering rhetorics against rampant neo-liberalism, the Government seems to blindly believe in the market to do the distribution.

Malaysian Economic Front hopes the stimulus will revive the economy in less than two years:

We must consider that government spending will never be able to restore or create demands to match for the demand of our goods before the economic downturn occurs. Due to the lower exports, our manufacturing sector will contract and capacity will be cut down to a sustainable levels Therefore plans must be laid to absorb retrenched workers from the affected sector.

When the stimulus was announced, it failed to inspire the stock market. Anil Netto notes that the stimulus plan is viewed as “belated official recognition that the country is being hard hit by the global economic and financial turbulence, with worse to come.” In a funny post, Art Harun instructs readers on how to earn from the stimulus.

Part of the stimulus involves scholarships for post-graduate studies. However, only few candidates are applying.

A member of Parliament lists his economic proposals. Vijay also suggests the following:

- Barter trade to partially circumvent commodity speculators, for example we can exchange our palm oil with Saudi Arabia for their crude oil.

- Unless you can prove that our country is in imminent danger of invasion, sell the scorpene submarines and other military hardware then use the proceeds to upgrade public transportation.

- Retrain a segment of fishermen to do fish farming, to stabilize the price of this diminishing resource, preserve marine ecosystems and save on diesel subsidies.

- Do away with internet provider monopoly, Streamyx service is so bad that businesses that rely on the wired world have had second thoughts about setting up shop here.

The thumbnail used was from the Flickr page of yinnxp


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