Harsh words for RM60b rescue plan
(The Straits Times) KUALA LUMPUR, March 12 — A day after the biggest stimulus package was unveiled by Deputy Premier Datuk Seri Najib Razak, it appears that few people have anything good to say about it.
Critics also said it did not do enough to give an immediate jolt to the economy by putting money into people's pockets to help them make ends meet, and stimulate domestic demand.
“I would call it a golden opportunity missed,” said economist Tan Sri Ramon Navaratnam, who is also the president of Transparency International.
He said the government should have seized the chance to restructure the economy, for instance by tackling abuses of the pro-Malay economic policies that had resulted in a lot of wastage.
Gerakan president Tan Sri Koh Tsu Koon said the mini budget should have focused on productivity and technological capability to remain competitive, rather than being a fiscal expansionary policy.
The mini budget, which will amount to 9 per cent of gross domestic product, is one of the largest announced by an Asian nation in relation to economy size.
It was tabled in Parliament on Tuesday in an effort to avert a deep recession.
Najib, however, acknowledged the economy could still shrink by 1 per cent this year as he painted a gloomy picture of a country hit by weaker exports, falling crude oil and palm oil prices, and rising job losses.
CLSA analyst Chee Wei Loong, however, said in a report that it is “almost a foregone conclusion” that Malaysia's economy will shrink 5 per cent this year. The stimulus package, he said, will not be felt until at least the final quarter of the year.
Opposition leader Datuk Seri Anwar Ibrahim told Parliament yesterday that promoting accountability should have been a major component in the package.
“The government needs to change its attitude in order to get the people's support, if not this stimulus package will be seen as only an exercise to rescue sick cronies and greedy monopolists, to reward the inefficient,” he said.
Critics have pointed to the first stimulus package of RM7 billion as an example.
Although announced last November, about RM5 billion worth of projects will begin only around June. The government recently disclosed that these projects went to Class F contractors who are largely linked to Umno.
MCA spokesman Lee Wei Kiat called on the government to ensure that multiracial companies are given a chance in open tender projects.
The opposition DAP had proposed last year the government give annual aid of RM6,000 to families with incomes of below RM6,000 a year.
The package, unveiled on Tuesday, did have measures like subsidies for food and tolls, scholarships, tax relief for housing loans, and a rebate for scrapping old cars. But there were no cuts to Employees Provident Fund contributions or tax rates, as many had hoped for.
Federation of Malaysian Consumers Associations secretary- general Muhammad Shaani Abdullah also said the government should have increased the spending power of the people instead of just giving them breathing space.
“At the end of the day, the people will still find it hard to make ends meet,” he said.
From the responses yesterday, it would appear that Najib has many hurdles to clear to convince Malaysians that the government is doing all it can for their benefit.
Slated to take over as premier next month, Najib is under pressure to prove his mettle, and to deflect the opposition's persistent attacks over his fitness for the top job.
